Trump and China’s Xi likely to talk this week

Published 12/05/2025, 15:42
© Reuters

Investing.com -- US President Donald Trump announced that he will likely have a conversation with Chinese leader Xi Jinping later this week following discussions to temporarily reduce tariffs and lessen the trade conflict between the two largest global economies. This conversation was disclosed by Trump on Monday at the White House.

The tariff agreement, which was the result of negotiations in Switzerland between Treasury Secretary Scott Bessent, US Trade Representative Jamieson Greer, and a Chinese delegation, will decrease the current 145% US tariffs on most Chinese imports to 30%. This includes the rate associated with fentanyl and is expected to be implemented by May 14. Additionally, the 125% Chinese duties on US goods will be cut down to 10%.

This three-month reduction of import duties will provide both countries with an opportunity to negotiate a wider trade agreement. The tariff reductions, however, will not be applicable to sectoral duties imposed on all US trading partners or to tariffs imposed on China during the first Trump administration.

In addition to the tariff adjustments, Trump stated that China agreed to "suspend and remove all of its non-monetary barriers." He further commented, "They’ve agreed to open China, fully open China. And I think it’s going to be fantastic for China. I think it’s going to be fantastic for us, and I think it’s going to be great for unification and peace. China will also suspend and remove all of its non monetary barriers, and they’ve agreed to do that."

Following these developments in trade talks, Wall Street saw significant gains, with the S&P 500 increasing about 2.5%.

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