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Brinks Report > Blog > World > US and China Agree to Pause Tariffs for 90 Days; Big Cuts on Both Sides
World

US and China Agree to Pause Tariffs for 90 Days; Big Cuts on Both Sides

Ankita Das
Last updated: May 12, 2025 3:12 pm
Ankita Das
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The winds of trade are shifting, and the latest development in the US-China relationship is definitely something to keep an eye on. Recent reports indicate a major agreement between the two economic giants, with both sides significantly cutting tariffs. This is huge news, and I’m here to break down what it means for businesses, consumers, and the global economy.

Us china tariff suspension 2025

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Read More: US May Cut China tariffs from 145% to 50% before trade talks in Switzerland

A Significant De-Escalation

Let’s get straight to the numbers. According to reports, the US is set to slash its tariffs on Chinese goods to 30% from a hefty 145%. Not to be outdone, China is reducing its tariffs on US products to 10% from 125%. These are not minor adjustments; they represent a substantial de-escalation in the trade tensions that have been simmering for quite some time.

But what exactly does this mean in practice? Well, think about it this way:

  • Reduced Costs: Lower tariffs mean lower import costs for businesses. This could translate into lower prices for consumers on a wide range of products, from electronics and clothing to household goods
  • Increased Trade Flow: With tariffs reduced, it becomes more attractive for businesses to import and export goods between the US and China. This could boost trade volumes and stimulate economic activity in both countries
  • Improved Business Confidence: The agreement signals a willingness from both sides to find common ground and de-escalate tensions. This could boost business confidence and encourage investment.

The million-dollar question is, why are we seeing this development now? There are a few factors likely at play:

  • Economic Pressures: The trade war has undoubtedly had an impact on both economies. Reduced tariffs could provide a much-needed boost to growth.
  • Political Considerations: Both governments may be seeking to stabilize relations and create a more predictable environment for businesses.
  • Global Uncertainty: With various global challenges, including geopolitical instability, a stable trade relationship between the US and China could be seen as a stabilizing force.

While this agreement is a positive step, it’s important to remember that it’s just one piece of the puzzle. The US-China trade relationship is complex and multifaceted. There are still many outstanding issues to be resolved, including intellectual property protection, market access, and cybersecurity. However, the current deal could pave the way for further negotiations and a more comprehensive trade agreement in the future. It is expected that China suspends the additional tariffs imposed on US goods for 90 days.

Also Read: Dollar Rises Against Yen and Franc as US-China Trade Talks Ease Concerns; Yuan Strengthens

For Indian businesses, this could also present some opportunities. A more stable global trade environment can benefit everyone, and India could potentially fill any gaps created by the shifting dynamics between the US and China. As an entrepreneur, I’m always looking for those kinds of possibilities!

It’s crucial to stay updated on these developments, and I’ll certainly keep you posted on how this US-China trade agreement progresses. By keeping an eye on the economic climate, we can all try to make informed decisions and strategize for the future. After all, being informed is the best way to navigate the ever-changing world of business. This agreement on tariffs is a significant step, but vigilance and adaptability will remain key to success.

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TAGGED:Economic RelationsGlobal Market NewsScott Bessenttariff cutsTrade Deal 2025US-China trade
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