Donald Trump has indicated that import duties on Chinese products would see a significant reduction, although not a complete removal. He said that high tariffs on goods from China would “come down substantially, but it won’t be zero”.
His comments at a White House briefing followed earlier statements made by US treasury secretary Scott Bessent, who argued that the current tariff levels were not viable in the long run and forecast a winding down of hostilities between Washington and Beijing.
Bessent described the negotiations with China as likely to be a lengthy process, noting that both parties recognised the current arrangement could not continue indefinitely.
Markets responded positively to the news, with the S&P 500 gaining 2.5% following media coverage of Bessent’s remarks.
Later in the day, Trump referenced the stock market’s rise but refrained from aligning himself publicly with Bessent’s characterisation of the trade relationship with China.
On the subject of Beijing, Trump maintained that the US was “in a good place” and stressed a conciliatory approach towards Chinese President Xi Jinping. He reiterated his preference for a cooperative relationship, suggesting that both nations could co-exist peacefully and potentially collaborate more closely.
Although the current tariff rate stands at 145%, Trump reiterated that it would be brought down considerably, making clear that it would not remain at its present level.
In ongoing efforts to reshape trade relationships, the White House has held discussions with officials from countries including Japan, South Korea, India, Canada, Mexico, and members of the European Union.
Despite this diplomatic activity, Trump has not shown any intention to remove the base 10% tariff he introduced, though he continues to pressure foreign governments to reduce import taxes and dismantle regulatory barriers that Washington believes have hindered American exports.
Meanwhile, Beijing has issued a cautionary statement to other nations, warning against entering into agreements with the US that might compromise China’s economic interests.
“Any accord reached at China’s expense will be firmly opposed,” declared the Chinese Ministry of Commerce in a formal response.
Tariffs of 145% have been imposed by the United States on goods from China, which has retaliated with levies of 125% on American exports. The administration has taken a similarly aggressive stance towards numerous other countries, fuelling concerns among investors. Market volatility and a spike in yields on US bonds have reflected anxieties around decelerating growth and mounting inflation.
Investor sentiment has also been swayed by Trump’s calls for the Federal Reserve to slash interest rates. Although he previously hinted at replacing Fed chair Jerome Powell, the president later clarified that he wished Powell would act preemptively but had no plans to remove him from the role.
