#USChinaTradeTalks *Recent Tariff Reductions and Temporary Truce**

- The U.S. and China agreed to a **90-day tariff reduction** in May 2025, suspending 24 percentage points of reciprocal tariffs while retaining a 10% baseline rate. This aims to ease tensions and create space for further negotiations .

- Critics argue this is a **fragile truce** rather than a long-term solution, with high tariffs still posing risks to inflation and supply chains .

### 2. **Economic and Global Implications**

- **Market reactions**: Oil prices and equities rallied on hopes of improved trade relations, but weak Chinese economic data (e.g., declining crude imports) tempered optimism .

- **Inflation concerns**: U.S. consumers face an average 17.8% effective tariff rate—the highest since the 1930s—which could push prices higher by Q3 2025 .

- **Supply chain disruptions**: The 39-day trade embargo in April 2025 exposed vulnerabilities in just-in-time inventory systems, prompting stockpiling and logistical bottlenecks