US, China Agree to 90-Day Tariff Cuts in Breakthrough Trade Truce: Markets React Positively

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Geneva: In a significant development aimed at easing months of trade tension, the United States and China have agreed to a 90-day tariff reduction, offering both sides breathing room to negotiate a more comprehensive agreement. The breakthrough, achieved during high-level talks in Geneva, is expected to provide temporary relief to businesses and global markets.

As per the agreement, the U.S. will slash its tariffs on most Chinese goods from 145% to 30%, while China will reduce its duties on American products from 125% to 10%. The tariff relief also extends to certain products linked to the fentanyl supply chain, a notable point of concern for Washington.

U.S. Treasury Secretary Scott Bessent described the move as a “measured step toward stability,” noting, “Neither country wants to break economic ties. This agreement creates space for better negotiations.”

China echoed the sentiment in a newly released white paper, affirming that while it is capable of withstanding pressure, its preference remains cooperation. “Threats will not work. Respect is the best way forward,” the document stated.

The development has already rippled through global financial markets. S&P 500 futures rose by 1.1% to 1.4%, while Nasdaq futures gained 1.4% to 1.9%. While the market response was slightly more muted than expected, analysts say the increase reflects cautious optimism among investors.

Though no final deal has been signed, both delegations claimed “good progress” during the Geneva talks. A joint statement from the White House is expected shortly, which may offer further clarity on the roadmap for continued negotiations.

Analysts caution that the current agreement is only a temporary reprieve, emphasizing the importance of the 90-day window being used wisely to reach a durable, long-term solution.

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