Catenaa, Tuesday, August 12 2025- The United States and China have agreed to extend their pause on tariff increases for 90 days, narrowly avoiding a sharp escalation in trade tensions between the world’s two largest economies.
President Donald Trump signed an executive order Monday just hours before tariffs on Chinese goods were set to rise from 30% to 54% midnight.
China, in turn, would have increased tariffs on American exports from 10% to 34%.
The extension, announced jointly by both governments, follows negotiations last month in Sweden.
Under the agreement, current tariff levels will remain in place while discussions continue. US officials, including Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer, have described the talks as constructive but warned that unresolved disputes remain, including China’s purchases of Russian oil, sales of dual-use technology to Russia, and commitments on rare earth exports.
The White House has also pressed for a U. buyer for TikTok, which faces a congressional deadline for divestment or a potential ban.
Trump has signaled that tariffs of up to 500% remain possible under pending legislation if Beijing fails to address US demands.
The truce contrasts with the administration’s hard-line threats toward other nations, including India, over Russian oil purchases.
Analysts say the softer tone toward Beijing could pave the way for a meeting between Trump and Chinese President Xi Jinping.
US stocks fell Monday ahead of key inflation data due Tuesday, with markets weighing both the trade reprieve and lingering geopolitical risks.
