In a surprise announcement on May 11, 2025, the United States and China confirmed a 90-day agreement to reduce mutual tariffs—a temporary truce in what has been the most intense phase of their ongoing trade war.
The deal, finalized in Geneva after three days of high-stakes negotiations, aims to lower trade barriers on hundreds of goods while giving both sides time to renegotiate long-standing economic grievances.
🔍 What’s in the Agreement?
- Tariff Cuts on Both Sides:
The U.S. will reduce tariffs from 145% to 80% on key Chinese imports, including electronics and rare earth minerals.
China will lower tariffs on American agricultural products, semiconductors, and vehicles—from 125% down to 70%. - Duration:
The agreement is explicitly temporary: 90 days, beginning May 15, 2025. During this time, both sides are expected to make structural reform proposals. - Snapback Clause:
If negotiations fail or either side escalates, tariffs will automatically return to previous levels.
📈 Market Reaction
Markets responded instantly:
- The S&P 500 and NASDAQ both surged 2% within hours of the announcement.
- Oil and commodity prices stabilized, reflecting eased fears of global slowdown.
- The yuan and U.S. dollar both strengthened against other currencies.
But not everyone is convinced the optimism will last.
💬 What Experts Are Saying
“This isn’t peace—it’s a timeout.”
— Lina Chen, Chief Asia Economist, BlueBridge Analytics“It gives Trump breathing room heading into election debates, and China a PR win. But it’s not a structural solution.”
— James Kremer, Georgetown School of Foreign Policy
🔮 Outlook: Real Progress or a Political Ploy?
The next 90 days are critical. If talks advance on forced tech transfers, IP rights, and subsidies, this temporary truce could lay the groundwork for something lasting.
But if history is any guide, a return to tariffs—or worse—is just one tweet away.
Keywords: US-China trade war 2025, 90-day tariff deal, economic diplomacy, global markets, trade tensions, Trump Xi Geneva talks