US-China Pause Tariff War With 90-Day Truce/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ The United States and China agreed to a 90-day pause in their escalating trade war, slashing recent tariffs and committing to new talks. The deal, announced in Geneva, lowers tariffs by 115 percentage points on both sides. Markets rallied as investors cheered the de-escalation between the world’s two largest economies.
US-China Tariff Truce Quick Looks
- Tariff reduction: U.S. drops China tariff from 145% to 30%
- China reciprocates: Cuts U.S. tariff rate to 10%
- 90-day pause on remaining 24% of tariffs
- Goal: Resume trade talks, avoid full economic decoupling
- Stock markets jump on truce announcement
- Deal made in Geneva, hosted at Swiss ambassador’s villa
- China suspends retaliatory measures, urges U.S. cooperation
- Investors hopeful, but analysts warn of uncertainty
US-China Pause Tariff War With 90-Day Truce
Deep Look
US and China Hit Pause on Trade War, Slash Tariffs in 90-Day Truce
GENEVA — The United States and China have agreed to a major de-escalation in their trade conflict, announcing a 90-day suspension of retaliatory tariffs and substantial reductions to levies that threatened to sever the global economy’s two most powerful engines.
At a press conference Monday in Geneva, U.S. Trade Representative Jamieson Greer and Treasury Secretary Scott Bessent confirmed the breakthrough following intensive weekend negotiations at the residence of the Swiss ambassador to the UN.
“What had occurred was the equivalent of an embargo,” said Bessent. “Neither side wants decoupling. We want trade—more balanced trade—and this is a step toward that.”
What’s in the Agreement
The deal reduces U.S. tariffs on Chinese goods from 145% to 30%, and Chinese tariffs on U.S. imports from 125% to 10%, according to officials from both countries.
In addition, both nations agreed to suspend 24% worth of additional tariffs for 90 days as they resume structured trade talks. The pause is intended to give negotiators time to resolve deeper economic disputes that have long divided Washington and Beijing.
China’s Commerce Ministry described the agreement as “an important step” toward resolving economic differences, calling it beneficial to consumers, producers, and global stability.
“This aligns with the expectations of both nations,” read the ministry’s statement. “It’s a win for global commerce.”
Behind the Scenes: Lakeside Diplomacy
Negotiations were held at a 17th-century villa overlooking Lake Geneva. At times, key negotiators broke from formal sessions to converse privately on patios, aiming to build trust and lay the groundwork for further progress.
“You could see them on the terrace talking in twos, not dozens. That’s when things started to move,” said a diplomatic observer.
Markets React Positively
The response from global markets was swift and optimistic:
- S&P 500 futures rose 2.6%
- Dow futures gained 2%
- Oil prices jumped over $1.60 per barrel
- Global benchmarks, including Hong Kong and European indexes, also surged
“This is a substantial de-escalation,” said Mark Williams, Chief Asia Economist at Capital Economics. “But there is no guarantee that the 90-day truce becomes a permanent peace.”
Lingering Risks and the Road Ahead
Despite the truce, uncertainty remains high. Many of the tariffs imposed since early 2024 are still in place. Both nations have yet to resolve core issues, including:
- China’s export controls on rare earths
- U.S. restrictions on Chinese tech firms
- Beijing’s demand to end “unilateral tariff hikes”
The European Union Chamber of Commerce in China welcomed the pause but emphasized that businesses need predictability for long-term investment and trade planning.
“A 90-day window is short,” said EU Chamber President Jens Eskelund. “We urge both sides to use this time constructively.”
Political Stakes: Trump’s Tariff Gambit
President Donald Trump escalated tariffs last month, raising U.S. duties to a combined 145% to pressure China on multiple fronts, including trade imbalances and the synthetic opioid fentanyl crisis.
China retaliated with 125% levies, triggering a tit-for-tat that threatened to choke off the $660 billion in annual trade between the two nations.
The truce now provides breathing room — both economically and diplomatically — and may influence Trump’s standing ahead of the 2026 midterms.
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