In a major breakthrough, the United States and China have agreed to a 90-day reduction in tariffs, easing tensions in their prolonged trade war that has shaken global markets and strained diplomatic ties.
The agreement was revealed Monday via a joint statement after high-stakes negotiations in Geneva over the weekend. Both sides highlighted “substantial progress” and reiterated their intention to develop a “sustainable, long-term, and mutually beneficial” trade relationship.
Details of the Agreement:
As part of the deal, the US will cut tariffs on Chinese goods from 145% to 30%, while China will lower its tariffs on American imports from 125% to 10%. The changes will take effect on Wednesday, May 14. However, US tariffs related to fentanyl, imposed earlier this year, will remain in place.
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Oversight and Future Talks:
A new bilateral working group will be formed, co-led by Chinese Vice Premier He Lifeng, US Treasury Secretary Scott Bessent, and Trade Representative Jamieson Greer. The group will hold rotating meetings and regular consultations to ensure ongoing dialogue and address emerging trade concerns. Bessent emphasized both nations want deeper trade ties, not decoupling.
Market Response:
The news triggered a global market rally. US stock futures jumped—Dow by over 2%, S&P 500 by nearly 3%, and Nasdaq by more than 3.5%. In Asia, Hong Kong’s Hang Seng Index soared more than 3%.
