US and China ease trade war tensions by agreeing ‘framework’ truce in London – business live

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US-China trade talks: ‘framework’ deal amid dispute over rare earths

The US and Mexico may be close to a breakthrough in negotiations over steel tariffs.

Reuters are reporting that the two countries are negotiating a deal to reduce or eliminate President Donald Trump’s 50% steel tariffs.

The main details came from Commerce Secretary Lutnick, who said that “We do absolutely expect that the topic of rare earth minerals and magnets” will be resolved and that export controls implemented by the US should come down as China approves relevant export licenses.

China’s trade representative Li Chenggang said that the US and Chinese delegations will now take the proposal back to their respective leaders, with Lutnick noting that “once the presidents approve it, we will then seek to implement it”.

“The details matter, especially around the degree of rare earths bound for the US, and the subsequent freedom for US produced chips to head East, but for now as long as the headlines of talks between the two parties remain constructive, risk assets should remain supported.”

“The U.S. will not completely remove restrictions on chip exports to China, but may relax the curbs in response to pressure from both Beijing and the domestic semiconductor sector.”

“The market likely anticipated this — Trump is just TACO (Trump always chickens out).”

“Look at how countries are negotiating with the U.S. these days; it’s no longer like how Vietnam approached things early on. Japan and South Korea are taking a tougher stance. People have realised that kneeling gets you nowhere — in fact, it only invites more bullying.”

“If we keep the terms of the Geneva Agreement, we’re looking at US tariffs on Chinese goods staying at 30% for a period of time and Chinese tariffs on US goods at 10%. So that’s down from 145% and 125% respectively. That would be fantastic.