(Recasts; updates yields)
By Kate Duguid
NEW YORK, May 17 (Reuters) - Trade tension between the United States and China ratcheted up again on Friday, pushing Treasury yields slightly lower as traders sought safety in high-quality assets.
China struck a more aggressive tone in its trade war with the United States on Friday, suggesting a resumption of talks between the world's two largest economies would be meaningless unless Washington changed course.
"We believe if there is meaning for these talks, there must be a show of sincerity," Chinese foreign ministry spokesman Lu Kang said.
"There has been a generalized risk-off move on the back of the headlines earlier from China that said they were not particularly interested in restarting negotiations on trade," said Jonathan Cohn, head of rates trading strategy at Credit Suisse.
Yields across maturities were lower, with the biggest moves at the long end of the yield curve. The 10-year yield was last down 0.9 basis point to 2.396%, with the 30-year yield last down 1.3 basis points at 2.827%.
Risk assets such as U.S. equities took a hit in early trade, but had recouped most of those losses by the afternoon. The S&P 500 index was down 0.15%, the Dow Jones Industrial Average was up 0.11% and the tech-heavy Nasdaq Composite down 0.42%.
Treasury prices also benefited from a collapse in Britain's Brexit talks. U.S. yields moved in sympathy with British government bond yields, which fell to their lowest level in six weeks on Friday as Prime Minister Theresa May's weakening grip on power revived fears of a no-deal Brexit and prompted investors to buy low-risk government bonds.
"The fact that it seems very unlikely the UK parliament will pass a Brexit deal now that Labour and UK government talks seem to have broken down, that may have also been an amplifying factor given the outperformance of Gilts," said Cohn.
The move lower in yields was buffeted by a report showing U.S. consumer sentiment jumped to a 15-year high in early May amid growing confidence about the economy's outlook. However, much of the surge was recorded before the escalation in the trade war.
The University of Michigan said its consumer sentiment index increased 5.3% to 102.4, the highest reading since 2004. Economists polled by Reuters had forecast a reading of 97.5. (Reporting by Kate Duguid; editing by Jonathan Oatis and Rosalba O'Brien)