• Trump has signed an executive order extending the tariff truce with China for another 90 days.
• The extension prevents U.S. tariffs from rising above 30% and offers China breathing room amid ongoing trade negotiations.
• Both nations aim to address trade disputes while maintaining lower tariffs until a potential Trump-Xi summit.
• China's Ministry of Commerce matched the U.S. move by announcing its own extension of tariff suspensions.
• Analysts caution that significant breakthroughs in negotiations remain unlikely.

U.S. President Donald Trump announced on Monday that he has signed an executive order extending the tariff truce with China for an additional 90 days, delaying an impending clash between the world’s two largest economies. This move occurred just hours before the previous agreement was set to expire, and it allows U.S. tariffs on Chinese goods to remain at 30%, while China retains its 10% tariff on U.S. exports.

The truce, initially established to de-escalate a heated trade war, aims to provide both countries the opportunity to work through their unresolved issues ahead of a possible summit between Trump and Chinese President Xi Jinping later this year. Trump's announcement on his Truth Social platform was quickly followed by a corresponding statement from China's Ministry of Commerce confirming their extension of tariff suspensions as well. The relief has been welcomed by U.S. companies engaged in trade with China, as it offers more stability during ongoing negotiations, according to Africanews and NPR.

During this extension, the two nations are expected to address various trade disputes, including the contentious issue of agriculture, especially the push for China to increase its purchases of U.S. soybeans. U.S. Trade Representative Jamieson Greer has suggested that a "grand bargain" may be difficult to achieve, representing a long-term challenge in U.S.-China relations, according to SCMP and India Times.

Analysts warn that despite the positive surface reactions, substantial breakthroughs might be elusive. Lynn Song, Chief Economist at ING, noted that while neither party wants to see re-escalation of tariffs, the details of negotiations will be complicated. Beijing is likely to hold onto some of its leverage against the U.S., especially concerning crucial sectors like rare earths and technology controls, according to SCMP, Al Jazeera, and Channel News Asia.

Both sides realize that considerable groundwork must be laid before any potential trade deal can be finalized. The next few months will be critical in determining whether they can reach consensus on significant trade agreements, particularly in areas concerning agricultural imports and technological restrictions. Trump's recent calls for increased soybean purchases from China illustrate ongoing negotiations but highlight the complexity involved in balancing both countries' economic interests.