⚖️ **US–China Trade War 101 – June 2025 Update**
🔍 **What’s Happening Now**
* 🌍 **High-Level Talks in London**: U.S. officials (Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, Trade Rep. Jamieson Greer) are meeting China's Vice Premier He Lifeng to address tariffs, rare-earth controls, and tech export limits amid a 90‑day tariff truce ([mawimagery.com][1], [theguardian.com][2]).
* ✈️ **Resume Boeing Deliveries**: Boeing 737 MAX deliveries to China have restarted, indicating eased tensions after a temporary halt in April ([reuters.com][3]).
* 📉 **China's Exports Plummet**: May exports to the U.S. dropped ~~35% YoY (~~\$28.8 bn), even as overall exports rose 4.8%. Deflation in factory-gate prices hints at domestic strain ([apnews.com][4]).
📈 **Market Ripple Effects*
Asia Rallies**: Positive sentiment from negotiations buoyed Asian equities, with Hong Kong’s Hang Seng up \~1.4% ([timesofindia.indiatimes.com][5]).
* **U.S. Futures Flat**: Slight dip in Dow, S\&P 500, Nasdaq futures ahead of London talks; investors remain cautious ([marketwatch.com][6])
🔄 **Key Negotiation Topics**
1. **Tariff Truce**: Extending the April‑May temporary pause on steep reciprocal tariffs.
2. **Rare Earths & Magnets**: Crucial for tech and defense; China temporarily halted exports and is now planning licenses.
3. **Advanced Tech Controls**: U.S. seeks fair access; China aims to protect its tech scale-up.
4. **Broader Trade Disputes**: Includes student visa access, market entry hurdles across various sectors
⚠️ **Why It Matters**
* 🛠️ **Global Supply Chains**: Rare-earth restrictions disrupt industries from EVs to electronics. China is urging partners like the EU to secure export licenses
* 🧮 **China’s Economic Stress**: Export slump hurting factories; deflation deepening
* 💹 **Market Volatility**: Outcomes of London talks could trigger swing in equities and currency markets
### 🗂️ **Summary Table**
| Topic | Current Status | Outlook |
| ----------------- | --------------------------------------- | ----------------------------------- |
| **Tariffs** | 90-day truce active; talks ongoing | Possible extension if talks succeed |
| **Rare Earths** | Exports paused, now licensing resumes | Major leverage in negotiations |
| **Tech Controls** | U.S. demands access; China protective | Ongoing point of contention |
| **Market Impact** | Asian markets up, U.S. futures cautious | High sensitivity to progress
### 💬 **What to Watch**
* 📅 **Negotiation Advances**: Especially rare-earth licensing and tech accessibility.
* 🏷️ **Economic Data**: Upcoming Chinese deflation reports & U.S. jobs/inflation readings.
* 📈 **Market Reactions**: Track equity indices, commodity prices, and FX.
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### ✅ **Takeaway**
* **Positive**: Boeing deliveries and dialogue signal softening tensions.
* **Cautious**: A full resolution is still uncertain—rare-earth exports and tech access remain friction points.
* **Tactical**: Monitor next few weeks—good news could boost markets; stall or breakdown could trigger pullbacks.