There is a 'level of risk' of a full-scale trade War, US's Mnuchin says

There is a risk that America and China might fall into a trade war, according to US Treasury Secretary Steve Mnuchin.

In remarks to CNBC, Mnuchin said there was a "level of risk" of a full-scale trade war - although he was "cautiously optimistic" that it could be avoided via talks.

"This has been very well organised. Our strategy is very clear," he said, explaining that the US administration had been very clear "from day one" that it was going to defend free and fair trade.

Yet above all, the Treasury Secretary emphasised that the reason the White House was studying levying new tariffs on Chinese goods was because in response to Washington's $50bn tariff list (10% of Chinese imports), Beijing had announced tariffs on $50bn of US-made goods (38% of US exports).

There are regular ongoing communications with Beijing, Mnuchin added, although he said the details were not going to be put in the public domain.

"We absolutely are willing to negotiate, but on the other hand the President is perefectly willing to defend [our] interests."

Later in the session, White House economic adviser Robert Kudlow indicated that there were "all kinds of back-channel discussions going on", insisting that China and the US were not in a trade war.

Significantly perhaps, Kudlow also said that technology and intellectual property rights were central issues.

"The American economy is driven by technology and technological advances. That's our future. We can't let them steal our work in this area."