New Cold War? China sees conspiracy to thwart its rise in Trump's trade war

Donald Trump is being taken very seriously in Beijing. 

China's capital is gripped by an urgent debate about what is seen as the hidden motive for Washington's escalating trade war: a grand strategy, devised and led by the US President, to thwart China's rise as a global power. As Bloomberg News reports, there's growing concern the two nations may be heading into a new Cold War.

While lower-level trade talks are set to resume this month, Trump has already tamped down expectations of a breakthrough. Chinese officials "just are not able to give us an agreement that is acceptable", he says. 

President Xi Jinping's administration has moved to contain any economic fallout. China appeared to be halting the recent slide in its currency, with the offshore yuan surging on Friday by the most since January 2017.

And despite the Cold War talk in Beijing, there is still general confidence that Xi can outlast Trump in a test of wills.

"Mr Trump put a knife on our neck," says Lu Xiang, an expert in bilateral ties at the government-run Chinese Academy of Social Sciences. "We will never surrender."