US, China Extend Trade Truce to Ease Global Tensions
In a last-minute breakthrough, the world’s two largest economies the United States and China have agreed to extend their trade truce for 90 days.
The deal was announced just hours before steep tariff increases were set to take effect on Monday, August 11, 2025.
US President Donald Trump signed an executive order pushing the pause until November 10, while Beijing confirmed a parallel extension.
Under the agreement, US tariffs on Chinese goods will remain at 30%, and China will maintain its 10% levy on American imports.
The decision averts a new wave of trade escalation that had threatened to hit global markets.
Earlier this year, Washington warned of tariffs reaching 145% on Chinese goods, while Beijing prepared duties as high as 125% on US shipments.
Both sides scaled back after trade talks in Geneva in May.
According to the White House, the extension allows more time to address what it called “trade imbalances” and “unfair trade practices,” pointing to the nearly $300 billion US trade deficit with China in 2024.
Negotiations will focus on greater market access for American exporters, national security concerns, and the stability of global semiconductor supply.
A spokesperson for the Chinese embassy in Washington stressed the need for cooperation.
“Win-win cooperation between China and the United States is the right path; suppression and containment will lead nowhere,” the official said.
Beijing also urged the US to drop “unreasonable” trade restrictions.
However, for many US businesses, uncertainty still lingers.
“There’s no way to plan for the future of the business,” said Beth Benike, founder of Busy Baby.
“I have no control or idea about the pricing that’s going to work for my business.”
Trade tensions peaked in April when the US imposed sweeping tariffs on several countries, with China among the hardest hit.
Beijing retaliated, nearly freezing trade flows until the May agreement eased some measures.
Current talks also include access to China’s rare earth minerals, its purchases of Russian oil, and US export curbs on advanced technology, including semiconductors.
Recently, Washington relaxed certain restrictions, allowing companies like AMD and Nvidia to sell some chips to China in exchange for a 15% revenue share with the US government.
Despite the truce, trade volumes have weakened. In June 2025, US imports from China were almost 50% lower than in the same month last year.
For the first half of 2025, imports totaled $165 billion, down 15% year-on-year, while exports to China dropped 20%.
The US-China trade truce may buy negotiators time, but analysts warn that unresolved disputes over technology, security, and market access could reignite tensions before the November deadline.
