#TradeWarEases The U.S. and China have agreed to a 90-day tariff suspension as part of a significant de-escalation in their trade war, marking a breakthrough in negotiations held in Geneva, Switzerland.

U.S. tariffs on Chinese goods will drop from 145% to 30%, while China’s tariffs on U.S. imports will decrease from 125% to 10%.

The cuts apply to tariffs imposed since April 2025, but older tariffs (e.g., those from Trump’s first term and fentanyl-related duties) remain in place. For example, the U.S. retains a 20% fentanyl tariff, bringing its total effective rate to 30% .

Hong Kong’s Hang Seng rose 3%, European indexes gained modestly, and U.S. futures (Nasdaq, S&P 500, Dow) jumped 2–4% .

- The U.S. dollar strengthened 1% against major currencies, while Treasury yields rose as investors scaled back bets on Fed rate cuts.

The deal provides immediate relief for small businesses and importers, easing shipping costs and supply chain disruptions . Analysts warn that challenges persist, including resolving disputes over intellectual property, rare earths, and long-term trade imbalances .

While the agreement is a temporary truce, experts caution that reaching a comprehensive deal within 90 days will require addressing deeper structural issues. Markets remain cautiously optimistic, but the risk of renewed tensions looms if negotiations stall.