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President Donald Trump on Monday extended a trade truce with China for another 90 days, postponing a potentially damaging tariff escalation between the world’s two largest economies.
Trump announced on his Truth Social platform that he had signed an executive order continuing the current arrangement, saying “all other elements of the Agreement will remain the same.” The extension pushes back a deadline set to expire at 12:01 a.m. Tuesday, when the United States could have raised tariffs on Chinese imports from 30% to even higher levels, risking swift retaliation from Beijing.
Background
The pause marks the latest attempt by Washington and Beijing to ease tensions after years of trade conflict. Since taking office, Trump has transformed U.S. trade policy, imposing double-digit tariffs on goods from nearly every major trading partner, including allies such as the European Union and Japan. The average U.S. tariff rate has surged from 2.5% to 18.6% — the highest since 1933, according to the Budget Lab at Yale University.
China has proven to be the toughest adversary, countering U.S. tariffs with its own and threatening to restrict exports of rare earth minerals critical to industries from electric vehicles to aerospace.
Legal and Policy Arguments
Business groups welcomed Monday’s decision, viewing it as a window for substantive negotiations. Sean Stein, president of the U.S.-China Business Council, called the extension “critical” to securing a broader agreement that would improve market access and provide companies with the stability to plan investments.
“Securing an agreement on fentanyl that leads to a reduction in U.S. tariffs and a rollback of China’s retaliatory measures is acutely needed to restart U.S. agriculture and energy exports,” Stein said.
Government and Expert Response
The administration has already made incremental deals with China, including easing restrictions on computer chip technology exports and petrochemical feedstocks in exchange for improved access to rare earths. But analysts warn that the toughest disputes — such as intellectual property protections, industrial subsidies, and the $262 billion U.S. trade deficit — remain unresolved.
“The U.S. has realized it does not have the upper hand,” said Claire Reade, a former assistant U.S. trade representative for China affairs.
Ali Wyne of the International Crisis Group argued that overreliance on steep tariffs has backfired. “By overestimating the ability of steep tariffs to induce concessions from China, the Trump administration has given Beijing reason to believe it can indefinitely enjoy the upper hand,” he said.
Broader Context
The trade war escalated to triple-digit tariffs in May, with U.S. duties on Chinese goods peaking at 145% and Chinese tariffs on U.S. exports hitting 125%. The extreme measures rattled global markets until both sides agreed in Geneva to roll back rates — to 30% for U.S. tariffs and 10% for China’s — and resume talks.
Next Steps
Experts such as Jeff Moon, a former U.S. trade official, predict only limited agreements in the near term, like increased Chinese purchases of U.S. soybeans and commitments to curb fentanyl precursor exports. “The trade war will continue grinding ahead for years into the future,” Moon said.
Whether the 90-day truce leads to a broader settlement or simply delays the next confrontation remains uncertain.
