US, China back off on immediate trade escalation

US, China back off on immediate trade escalation


Gofrixty [13 August 2025] –
 In an effort to cool tensions, the US and China agreed over the weekend not to impose additional trade tariffs for 90 days. The President announced the extension after talks with Chinese officials and China followed up by confirming through its Ministry of Commerce. The announcement came less than eight hours before a dramatic increase in tariffs on both American and Chinese goods was set to take effect, raising U.S. rates to 30% on more than half the expensive $250 billion worth of products already affected and China’s rates to 10%.

The negotiators need more time to resolve differences over trade imbalances, intellectual property theft, subsidies and export control. The leaders of both countries hope to set up a meeting between Trump and Xi in the coming months as they look for progress. The move, which was lauded by business groups as it allows companies more certainty to make investments without fear of sudden cost increase.


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Financial markets reacted strongly. Asia• Japan’s Nikkei index climbed 2%, while in Australia the S&P/ASX 200 hit record levels and U.S. stock futures rose as investors moved into “buy” mode under cautious optimism that trade tensions could ease.

Analysts warned the extension simply pushes off unresolved issues. Still, both sides were preserving their basic demands and the danger of renewed fighting persists if negotiations do not produce an accord before the cease-fire expires.


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