#TradeWarEases

As of May 12, 2025, the USA and China have made significant progress in trade negotiations, signaling a possible end to the prolonged trade war. During a meeting in Geneva, the parties agreed to establish a permanent consultation mechanism to avoid further escalations. This step came after mutual tariff increases—up to 145% from the USA and up to 125% from China. US President Donald Trump called the negotiations "very good" and hinted at a possible reduction of tariffs to 80%, which may indicate a shift in the administration's approach to trade policy.

Financial markets reacted positively: the CSI 300 index in China rose by 0.6%, and futures on the S&P 500 showed optimistic sentiment. Analysts note that while the agreement is encouraging, the lack of specifics may lead to increased uncertainty in the long term. However, the markets currently view the agreement as a positive signal for stabilizing the global economy and reducing geopolitical tension between the two largest economies in the world.