In a landmark move, the United States and China have agreed to a 90-day tariff truce, significantly lowering tariffs on each other’s imports. The US will reduce tariffs on Chinese goods from 145% to 30%, while China will cut its tariffs on US goods from 125% to 10%. This unprecedented easing of trade tensions is being hailed as a major victory for Donald Trump, who is likely to leverage this win politically as elections approach.
Global Market Impact:
Stock markets are poised for a rally, especially in sectors like technology, manufacturing, and agriculture, which have been heavily impacted by tariffs.
Commodity markets (soybeans, metals) are expected to see price increases due to renewed trade flows.
The Chinese yuan could appreciate as investor confidence in China's economic outlook strengthens.
Supply chain-dependent companies may benefit from reduced import/export costs, improving profitability.
Crypto Market Impact:
While cryptocurrencies are often considered decentralized and independent from traditional markets, they are not immune to macroeconomic factors. The US-China trade truce could have mixed effects on the crypto market:
Risk-On Sentiment Boost: Easing trade tensions typically increases investor risk appetite, which could drive capital back into equities and riskier assets, including cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and altcoins.
Reduced Safe-Haven Demand: During periods of geopolitical tension, crypto assets sometimes act as a hedge or “digital gold.” A temporary resolution may reduce safe-haven flows into crypto, possibly softening immediate bullish momentum.
Increased Liquidity in Asia: With reduced tariffs, Chinese businesses and consumers may see improved economic conditions, potentially increasing crypto trading volumes in Asia, especially in Hong Kong and Singapore markets.
Regulatory Perspective: Positive US-China relations might ease broader concerns over regulatory crackdowns on digital assets, fostering a more favorable environment for crypto innovations and institutional adoption.
