U.S. and China to ease tariffs significantly for 90 days, White House announces

The recent agreement between the U.S. and China to temporarily ease tariffs has been met with widespread relief and optimism. Both countries released a joint statement announcing a 90-day suspension of most of the levies imposed since early April, signaling a significant breakthrough in their trade negotiations.

According to U.S. Treasury Secretary Scott Bessent, the temporary reductions in tariffs will see the U.S. reducing its levies on Chinese goods to about 30%, while China will reduce its tariffs on American imports to 10%. This move comes after months of escalating tensions between the two economic powerhouses, with the U.S. imposing tariffs of 145% on all goods imported from China and Beijing retaliating with tariffs of 125% on American imports.

The high tariffs had a profound impact on global financial markets, leading to a drastic drop in trade between the U.S. and China. However, with the recent agreement to suspend most of the levies, there is hope for a return to more balanced trade relations between the two countries.

The announcement of the tariff suspension has already had a positive effect on stock markets, with commodities and currency markets in Asia and beyond experiencing a significant boost. Stock futures in the U.S. surged, with the Dow gaining over 1,000 points and the S&P 500 and Nasdaq Composite also seeing substantial gains.

While the agreement is a step in the right direction, some analysts remain cautious about the longevity of the truce and whether both sides are truly committed to reaching a more permanent agreement. Despite assurances from U.S. officials that neither country wants a complete decoupling, there are concerns about the underlying tensions that have yet to be fully addressed.

In the meantime, the global markets are cautiously optimistic about the prospects of a more stable trade relationship between the U.S. and China. The coming months will be crucial in determining whether the temporary easing of tariffs will pave the way for a more sustainable and mutually beneficial trade agreement.