Donald Trump eases China tariffs as nations agree trade war truce
US and China pause trade war in new agreement
- Chinese shares retreated from a decade high following a high-stakes meeting between US President Donald Trump and Chinese President Xi Jinping in South Korea.
- The two leaders agreed to a trade-war truce, with President Trump stating a deal was struck to reduce tariffs on China in exchange for Beijing resuming US soybean purchases, maintaining rare earth exports, and tackling illicit fentanyl trade.
- China's commerce ministry confirmed the extension of a temporary trade truce for another year, following an agreement reached by top economic officials last week.
- Market reaction was cautious and choppy, with investors wary due to previous trade negotiations that saw promising starts followed by setbacks.
- Analysts described the agreement as a “tactical pause” rather than a “strategic breakthrough”, noting that significant structural issues remain unresolved despite the de-escalation of tensions.