U.S. President Donald Trump’s administration is considering bringing down its punishing tariffs on China in a bid to de-escalate trade tensions with the world’s second-largest economy, according to the Wall Street Journal.
Trump has yet to make a final decision, while the negotiations are fluid and several options remain in play, the WSJ reported, citing people familiar with the matter.
The Journal added that the tariffs on China may come down to between about 50% to 65%. A tiered approach that would place 35% tariffs on items the U.S. does not consider to be a threat to national security and at least 100% duties on those it deems strategic to U.S. interests is also being mulled over, the paper said.
U.S. tariffs on China were lifted earlier this month to at least 145%, sparking retaliatory countertariffs from Beijing of 125% on American imports. The trade spat, which has come despite Trump putting a 90-day pause on elevated duties on most countries, has roiled financial markets and clouded the outlook for businesses.
But investor sentiment was bolstered on Tuesday on signs that the White House may be softening its adversarial attitude to trade negotiations with China.
Trump told reporters that U.S. levies on China would fall after a deal is secured, although he noted that duties would not decline all the way to zero. Treasury Secretary Scott Bessent also said that while discussions with Beijing would be a "slog", he believes the two countries can cool down intensifying trade tensions.
On Wednesday, China also signaled that it was open to discussing trade with the U.S., although Beijing continued to stress that it wouldn’t negotiate if the White House continues to threaten it. Policymakers in China view Trump’s comments on Tuesday as a sign that he is folding on his trade stance, the WSJ reported.
