U.S., China Reach Agreement To Lower Tariffs In 90-Day Cool-Off Period

China and the U.S. moved to ease trade tensions early Monday, agreeing to a temporary 90-day reduction in reciprocal tariffs on each other's goods, according to a joint statement released by both governments on X. The accord, viewed as a breakthrough in a multi-month trade war between the world's two largest economies, helped spark a rally in global markets: S&P 500 futures rose 3%, while Nasdaq futures gained 4%. European markets also advanced, and the U.S. dollar strengthened. U.S. government bonds sold as investors rotated back into equities and other risk-sensitive assets. 

The joint statement said that the U.S. will reduce levies on most Chinese imports from 145% to 30% by Wednesday. 

Here's a summary of the U.S. actions:

The United States will remove the additional tariffs it imposed on China on April 8 and April 9, 2025, but will retain all duties imposed on China prior to April 2, 2025, including Section 301 tariffs, Section 232 tariffs, tariffs imposed in response to the fentanyl national emergency invoked pursuant to the International Emergency Economic Powers Act, and Most Favored Nation tariffs.

• The United States will suspend its 34% reciprocal tariff imposed on April 2, 2025 for 90 days, but retain a 10% tariff during the period of the pause.
• The 10% tariff continues to set a fair baseline that encourages domestic production, strengthens our supply chains and ensures that American trade policy supports American workers first, instead of undercutting them.
• By imposing reciprocal tariffs, President Trump is ensuring our trade policy works for the American economy, addresses our national emergency brought on by our growing and persistent trade deficit, and levels the playing field for American workers and producers.
• Unlike previous administrations, President Trump took a tough, uncompromising stance on China to protect American interests and stop unfair trade practices.