The United States and China have reached a provisional agreement in the context of the trade war.
The world’s two largest economies will bilaterally reduce tariffs imposed on most products by 115 percentage points.
The agreement will come into effect on Wednesday (12) and will be valid for 90 days.
The announcement was made late Sunday night, at the end of bilateral negotiations held over the weekend in Geneva.
This is a much larger cut than expected.
Tariffs imposed by the United States on most Chinese products have gone from 145% to 30%.
Tariffs imposed by China on US products have fallen from 125% to 10%.
The initial expectation was that representatives of Donald Trump and Xi Jinping would reach a tariff rate of around 50% to 60%, a level that would maintain a situation close to a trade embargo.
“We have reached an agreement for a 90-day pause and a substantial reduction in tariff levels,” said US Treasury Secretary Scott Bessent, before announcing the few details of the pact during a press conference.
It is not a final agreement, however.
Observers are still awaiting details of what was agreed upon.
More information is expected to emerge in the coming hours.
Representatives of the US and China said they will continue negotiating in the coming weeks and months.
In any case, the speed with which Washington and Beijing reached a consensus was surprising.
Market reaction to the agreement
The announcement of an agreement unleashed a wave of euphoria in the financial markets.
Asian stock markets closed sharply higher on Monday.
European stock markets started the week in the same vein.
On Wall Street, New York stock futures indexes opened up more than 2%.
The dollar and oil also gained strength on Monday.
Source: www.seudinheiro.com, by Ricardo Gozzi