The United States is reportedly considering a significant reduction in tariffs on Chinese imports, signaling a possible thaw in trade tensions between the world’s two largest economies.
According to a Wall Street Journal report published on Wednesday, the US administration may slash tariffs from their current level of 145% to between 50% and 65%, citing a White House official.
The proposed move is aimed at easing ongoing economic friction with Beijing, although the administration has yet to make a formal announcement.
A source familiar with the matter confirmed that the White House is open to discussing tariff reductions but emphasised that no unilateral decisions will be made — any action would be part of broader negotiations with China.
President Donald Trump commented on the potential shift, stating, “We are going to have a fair deal with China,” though he stopped short of confirming any specifics. White House spokesperson Kush Desai downplayed the report, calling it “pure speculation” unless the information comes directly from Trump.
Despite the possible reductions, the adjusted tariff range would still represent a substantial barrier to trade. German shipping company Hapag-Lloyd revealed that nearly 30% of its China-to-US shipments have already been canceled, reflecting the ongoing strain on logistics and commerce.
In response to US tariffs, China has imposed retaliatory duties of up to 125% on American imports, along with other economic countermeasures. Treasury Secretary Scott Bessent acknowledged that both nations view the current tariff levels as unsustainable, but admitted that there is no clear timeline for when formal negotiations might begin.
Other diplomatic efforts, including US-China discussions on curbing the fentanyl crisis, have so far failed to yield meaningful progress.
Financial markets reacted positively to the tariff news. US stocks surged, with the S&P 500 climbing nearly 3% in mid-morning trading, buoyed by investor relief over Trump’s softened stance on the Federal Reserve and renewed optimism for a trade resolution with China.
The Wall Street Journal also reported that the tariff talks remain in a fluid state, with multiple strategies under consideration. One proposal involves a tiered system of levies — a 35% tariff for non-sensitive goods and a higher rate of at least 100% for items deemed critical to US national security. This structure, suggested by a House committee last year, would be phased in over five years.
In addition to China-specific duties, the US has imposed a general 10% tariff on all imports and increased levies on key sectors such as steel, aluminum, and automobiles. While some targeted tariffs have been temporarily suspended until July 9, the administration has also floated new tariffs on pharmaceuticals and semiconductors — further unsettling global markets.
The International Monetary Fund (IMF) warned on Wednesday that such protectionist measures could slow global economic growth and exacerbate public debt burdens worldwide.