According to Reuters, US Agriculture Secretary Brooke Rollins stated on Sunday that the Trump administration is engaged in ongoing discussions with China regarding tariffs. Rollins indicated that negotiations between the two countries are in progress and that trade agreements with other countries are “very close” to being finalized.
“We are in communication with China every day, along with the other 99 or 100 countries that have engaged in discussions,” Rollins commented.
Market reaction
As of this writing, the AUD/USD currency pair has declined by 0.27% during the session, trading at 0.6380.
US-China Trade War FAQs
In broad terms, a trade war signifies an economic dispute between nations stemming from intense protectionist measures implemented by one party. This involves the establishment of trade restrictions, such as levies, which prompt retaliatory measures, thereby increasing import expenses and, consequently, the cost of living.
The economic friction between the United States and China commenced in early 2018, when then-President Donald Trump imposed trade barriers on Chinese goods, citing unjust business practices and the misappropriation of intellectual property by China. China responded with countermeasures, placing tariffs on various US products, including vehicles and soybeans. These tensions grew until the US and China concluded the Phase One trade agreement in January 2020. The accord mandated structural overhauls and other adjustments to China’s economic and trade framework, intending to restore stability and confidence between the two countries. However, the Coronavirus outbreak shifted attention away from the conflict. It is noteworthy that President Joe Biden, Trump’s successor, maintained the existing tariffs and even introduced additional ones.
The return of Donald Trump to the White House as the 47th US President has reignited tensions between the two nations. During his 2024 campaign, Trump pledged to impose tariffs of 60% on Chinese goods upon his return to office, which occurred on January 20, 2025. With Trump’s reinstatement, the US-China trade war is expected to resume where it left off, with reciprocal policies affecting the global economic environment, causing disruptions in global supply networks, leading to decreased spending, particularly in investment, and directly influencing Consumer Price Index inflation.
