President Donald Trump announced that the extremely high tariffs placed on goods from China will soon be reduced. Currently, American tariffs on Chinese products sit at a massive 145%. However, Trump said this rate would come down “substantially,” even though it will not drop all the way to zero.
Trump’s comments followed statements made by Scott Bessent, a top U.S. government official responsible for the country’s finances. Bessent said the current trade fight with China can’t continue the way it is. He called the situation “unsustainable,” meaning it’s hurting both sides too much and needs to change.
Though Trump acknowledged that the tariffs would be lowered, he made it clear that they wouldn’t be removed completely. “It won’t be that high, not going to be that high,” he said, referring to the 145% rate.
A Trade Battle With Ripple Effects
Over the last few years, the U.S. government placed high tariffs not only on China but on many other countries too. China answered by hitting U.S. products with its own heavy tariffs—125% on American goods. This back-and-forth led to a trade fight that affected the entire global economy.
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The situation has caused some problems back home. Stock markets were shaky, and the cost of borrowing money for the U.S. government went up. Investors are nervous that high tariffs will slow down business and raise prices for things people buy every day.
Still, after news broke that the U.S. might ease up on tariffs, stock markets shot up. One major market, the S&P 500, went up by 2.5%, showing that investors were hopeful about the change.
Trump seemed happy with the stock market rise, saying, “We’re doing fine with China.” Yet, he did not clearly say whether he agreed with earlier comments that the trade war could not go on forever.
He also added that he doesn’t want to be harsh toward China. Instead, he said he wanted the two countries to “live together very happily and ideally work together.”
Global Reactions to Trump’s Announcement
The Chinese government has not officially responded to Trump’s announcement. However, comments on Chinese social media suggested that many people there saw this as a win for China. Some posts said the U.S. had “admitted defeat,” while a Chinese newspaper called the U.S. approach “populist protectionism” and blamed it for disturbing global trade.
In past years, each time the U.S. raised its tariffs, China responded by doing the same. But after reaching the 125% mark, China stopped. It said those tariffs had already reduced demand in China for American-made products.
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Although the U.S. has paused new tariffs for 90 days on many countries, that pause does not include China. Talks have continued between the U.S. and trade officials from countries like Japan, India, South Korea, Canada, Mexico, and those in Europe. These meetings are part of the effort to sort out the many trade disagreements caused by the tariff policy.
China’s Warning and Ongoing Negotiations
China also warned other countries not to make any trade deals with the U.S. that could hurt China’s interests. On top of that, reports from South Korea suggested that China is now pressuring companies in other countries to stop sending products to the U.S. military if those products contain Chinese materials.
Meanwhile, the White House said that 18 countries have sent in proposals for new trade deals with the U.S. A government spokesperson said, “Everyone involved wants to see a trade deal happen.”
At the same time, Trump has urged the country’s central bank to lower interest rates to help the economy. Although he once hinted he might fire Jerome Powell, the chair of the U.S. Federal Reserve, Trump now says he doesn’t plan to do that.
As trade talks and economic decisions continue, the message from the U.S. government is clear: the tariffs will drop from where they are, but they won’t go away completely.
