The US authorities have granted license applications worth hundreds of millions of dollars for China's blacklisted telecom company Huawei to buy chips for its growing auto component business, Reuters reports, citing two people familiar with the matter.
Key highlights
The US has granted licenses authorizing suppliers to sell chips to Huawei for such vehicle components as video screens and sensors.
The approvals come as Huawei pivots its business toward items that are less susceptible to US trade bans.
Auto chips are generally not considered sophisticated, lowering the bar for approval.
The government is granting licenses for chips in vehicles that may have other components with 5g capability.
Asked about the automotive licenses, a US Department of Commerce spokesperson said the government continues to consistently apply licensing policies "to restrict Huawei's access to commodities, software, or technology for activities that could harm U.S. national security and foreign policy interests."
Market reaction
The above developments are likely to bode well for the US-China diplomatic ties, although fail to have any positive impact on the Australian dollar, as AUD/USD falls below 0.7250 on the US dollar’s rebound.
Meanwhile, the futures tied to the S&P 500 index drop 0.10% to 4,480 amid persisting covid concerns.
