Larry Kudlow says phone call earlier this week with China on trade 'went very well'

White House economic advisor Larry Kudlow said recent conversations with China "went very well."

"The phone call the night before last with Secretary Mnuchin and Lighthizer and Vice Premier Liu He went very well. That's important," Kudlow said Friday on CNBC's Squawk on the Street. "The phone lines have been open during this period and the negotiations have been proceeding."

Liu, China's top negotiator on trade, U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin held a phone call Wednesday and agreed to meet in early October for another round of negotiations.

"The deputies level [meeting] will continue in Washington later this month and from that deputies level meetings will come agenda and outline so the principles with meet [in] early October," Kudlow said. "I think this is terribly important."

A USTR spokesperson said earlier this week that both countries "agreed to hold meetings at the ministerial level in Washington in the coming weeks" and that deputy-level meetings would take place in mid-September "to lay the ground work for meaningful progress."

Many market participants and China insiders believe these new trade talks could lead to something substantial. The two countries have been engaged in a trade war for 18 months now. The meetings will follow the latest round of tariffs on billions of dollars' worth of goods from each country that took effect on Sunday.

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