US and China Announce Agreement to Cut Reciprocal Tariffs for 90 Days
The U.S. and China issued a joint statement on Monday announcing an agreement to cut reciprocal tariffs for 90 days, with both sides "recognizing the importance of a sustainable, long-term, and mutually beneficial economic and trade relationship." Representatives from both countries convened for talks in Geneva, Switzerland, this weekend in a bid to establish the basis for negotiations in a broader potential trade deal. President Donald Trump's "Liberation Day" tariff measures announced in April touched off a spiraling trade war between the two economic giants, roiling markets and prompting fears of a recession in the U.S.
U.S Trade Representative Jamieson Greer noted that the U.S. and China will maintain 10 percent reciprocal tariffs as part of the agreement.
Total Retail's Take: This should be welcome news for both retailers and consumers. For the former, it gives them additional time to evaluate their strategy for dealing with tariffs, including potentially finding new suppliers, diversifying product mixes, raising prices, among other actions. For consumers, this announcement offers a potential reprieve from higher prices, as many brands planned to pass the increased costs from tariffs onto consumers.
Even with the encouraging news that an end to the trade war with China could be forthcoming, some analysts have urged caution, noting that tariffs remain far higher than before Trump regained office. That suggests many consumer goods — from cars and groceries to fireworks — are set to see price hikes.
