U.S.-China Agree to 90-Day Tariff Suspension Extension from August 12

The United States and China have mutually agreed to extend the temporary suspension of 24% tariffs on each other’s goods for an additional 90 days, starting from August 12, 2025. This decision, announced during the U.S.-China Stockholm Economic and Trade Talks, aligns with ongoing efforts to manage trade tensions without immediate escalation. The U.S. will continue to amend the implementation of ad valorem tariffs under Executive Order 14257, suspending the 24% rate while retaining a 10% tariff on Chinese goods, including those from China Hong Kong and China Macau. On the Chinese side, the State Taxation Administration will similarly suspend the 24% tariff under Announcement No. 4 of 2025 and is maintaining its commitment to refrain from implementing non-tariff retaliatory measures as outlined in the Geneva Joint Statement [1].

The extension was reportedly made just hours before the August 12 deadline, with U.S. President Donald Trump reportedly signing an executive order to implement the 90-day pause [2]. The move reflects a strategic pause in escalating trade disputes, particularly amid reports of China deepening its economic ties with other global partners [3]. The previous tariff truce was first implemented in May 2025, providing a temporary cooling-off period to facilitate dialogue. Trump’s decision to extend it underscores a continued attempt to stabilize U.S.-China trade relations while allowing more time for negotiations.

Market participants have largely anticipated the extension, with analysts noting that the U.S. administration was likely to avoid triggering immediate disruptions to global supply chains in the lead-up to the deadline [4]. The truce allows both governments to assess their positions and explore the possibility of a more permanent resolution. However, the lack of clarity on future tariff adjustments introduces ongoing uncertainty for businesses in both countries, which must continuously adapt to shifting trade policies [5].

The decision also highlights the delicate balance the U.S. administration must maintain between domestic political pressures and the need for stable international trade. While the extension prevents an immediate escalation, it does not resolve the underlying structural issues in the U.S.-China trade relationship. Analysts have pointed out the risks associated with prolonged uncertainty, particularly for companies that rely on predictable trade policies for strategic planning and investment [5].

The global financial markets have reacted cautiously to the news, with Asian shares having shown signs of optimism in the days before the deadline [6]. Investors will be closely monitoring any developments from the U.S. and Chinese trade teams in the coming months to gauge whether this latest extension will lead to a broader agreement or merely another short-term delay in the broader trade conflict.

Source:

[1] https://www.theblockbeats.info/en/flash/306921

[2] https://www.gjsentinel.com/news/national/trump-signs-order-to-extend-china-tariff-truce-by-90-days-us-media/article_968bd6d0-a9e4-5aac-9f24-5c160a635e8b.html

[3] https://finance.yahoo.com/news/live/trump-tariffs-live-updates-us-china-deadline-looming-court-ruling-on-trumps-authority-in-focus-200619980.html

[4] https://www.gjsentinel.com/news/national/stocks-cautious-before-tariff-updates-us-data/article_af435118-c1de-5419-83a0-eeb56c59544e.html

[5] https://wgno.com/news/business/ap-asian-shares-advance-ahead-of-trumps-deadline-for-imposing-higher-tariffs-on-chinese-goods/

[6] https://www.fibre2fashion.com/news/apparel-news/as-trump-s-tariffs-take-effect-countries-asses-shifting-trade-dynamics-304532-newsdetails.htm