#TradeWarEases The U.S.-China trade war has taken a significant turn toward de-escalation. On May 12, 2025, the United States and China agreed to a 90-day suspension of tariffs, marking a pivotal step in reducing tensions that have strained bilateral relations and global markets.

Key Details of the Agreement

Tariff Reductions: The U.S. will lower tariffs on Chinese goods from 145% to 30%, while China will reduce its tariffs on U.S. products from 125% to 10%.

Duration: The suspension is set for 90 days, providing a temporary reprieve from escalating trade hostilities.

Dialogue Mechanism: Both nations have established a permanent dialogue channel to address ongoing trade issues and prevent future escalations.

Market Reactions

The announcement has had a positive impact on global markets:

U.S. Stock Market: The S&P 500 futures rose by 2.8%, indicating investor optimism.

Currency Markets: The U.S. dollar strengthened by 0.7%, reflecting renewed confidence in the U.S. economy.

Commodity Prices: Gold prices retreated by 2.3%, as concerns over inflation eased.

Broader Implications

This agreement signals a shift towards cooperation between the world's two largest economies, potentially leading to a more stable global economic environment. However, analysts remain cautious, noting that while the deal is a positive development, its long-term effectiveness will depend on the implementation of the agreed terms and the resolution of underlying trade issues.

As the 90-day period progresses, the international community will be closely monitoring the situation to assess whether this represents a lasting thaw in U.S.-China trade relations.