New York (CNN Business) The trade war with China has been a two-steps forward, three-steps back affair. The current thinking is in the "two-steps forward" camp.

The president told reporters Monday his negotiators are moving ahead on a so-called Phase One trade agreement : "We're looking probably to be ahead of schedule to sign a very big portion of the China deal."

The president teased a meeting with Chinese President Xi Jinping at the APEC summit in Chile next month and said progress was "a little bit ahead of schedule, maybe a lot ahead of schedule." The contours of this first phase include purchases of US agriculture, promises on intellectual property rights and in-roads for US financial firms in China.

"It will also take care of a lot of the banking needs," the president told reporters.

It's a dose of optimism in a trade war that has dragged on for a year and a half. On Friday, US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin spoke with Chinese Vice Premier Liu He by phone, according to a statement from the US Trade Representative's Office, and made "headway."

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