Larry Kudlow, the director of the National Economic Council, believes economic conditions now are more favorable for the US. His comments came after GDP growth data showed that the annualized growth rate reached 3.2 percent in the first quarter. Kudlow believes that this economic strength gives the US a leverage in the trade talks with China.

Contrasting performance

Kudlow’s view is that there is a contrast between the performance of the US economy and that of China. He believes this is the case because of the weak data that has been coming out of China in recent months, and the strong data coming out of the US recently. In addition to positive growth rate, the Michigan consumer sentiment index showed improvement in April. US equities benchmarks are also at historic highs.

Balance is tilting in the US’s favor

The balance, according to Kudlow, is tilting to the US’s favor. Strong growth means that there will be demand from the US for Chinese goods. China needs this demand to stimulate its economy, as a good percentage of its income comes from exports.

There has been progress in the trade talks recently. The US wants to reduce its trade deficit with China, whereas China wants to maintain growth momentum. The tensions resulting from this spat have impacted economies elsewhere such as that of Australia. A final deal is yet to be reached, although the two large economic powers appear to be close.