The United States and China have agreed to extend their tariff truce by another 90 days, postponing the risk of a renewed trade war between the world’s two largest economies until November 10.
The truce, which was due to expire on August 12, will see current tariff levels maintained while both sides work to address unresolved trade disputes.
US President Donald Trump announced the extension on Sunday, saying in a post on Truth Social, “I have just signed an executive order that will extend the tariff suspension on China for another 90 days. All other elements of the agreement will remain the same.”
China’s Commerce Ministry confirmed it would keep tariffs on American products at 10 per cent and would suspend additional duties for the same period. It also pledged to address non-tariff barriers affecting US goods.
The extension follows the latest round of negotiations between US and Chinese trade officials in Stockholm last month.
Without the agreement, US tariffs on Chinese goods would have reverted to peak levels seen in April during the height of the trade conflict. The two sides had initially reached a 90-day truce in May after talks in Geneva.
Analysts say the move will ease immediate concerns in global markets, which have been unsettled by escalating trade tensions. Earlier this year, Washington raised tariffs on Chinese imports to as much as 145 per cent, prompting Beijing to retaliate with restrictions on rare earth exports critical to American manufacturing.
Under the May agreement, US tariffs were reduced to 30 per cent, while China lowered its levies to 10 per cent and resumed rare earth magnet exports.
The extended pause is expected to give negotiators more time to address issues such as US tariffs linked to fentanyl trafficking and China’s purchases of sanctioned Russian and Iranian oil.
It could also pave the way for Trump to visit China for talks with President Xi Jinping in late October, coinciding with an international summit in South Korea.
Despite the tariff reprieve, disagreements remain over technology trade, particularly in the artificial intelligence sector. Nvidia Corp and Advanced Micro Devices (AMD) have reached deals to pay 15 per cent of certain Chinese AI chip revenues to the US government in exchange for export licences.
Trump has also signalled willingness to allow Nvidia to sell a scaled-down version of its most advanced AI chip to China.
However, tensions persist after Chinese regulators summoned Nvidia in late July over alleged security vulnerabilities in its H20 chips, underscoring mutual distrust in the tech arena.
The extension comes as part of the Trump administration’s wider strategy of imposing reciprocal tariffs and targeted levies on multiple countries.
The current US tariff rate on Chinese imports includes a 20 per cent charge tied to fentanyl trafficking and a 10 per cent baseline tariff, in addition to duties from Trump’s first term.
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