Trade war: USA and China significantly reduce mutual tariffs
The US and China are escalating their dispute over tariffs. Both sides agreed to a 90-day pause in their trade conflict and lower tariffs. This is causing euphoria on the stock markets.
- In the trade dispute, the US and China intend to significantly reduce their mutual tariffs. The tariffs will be cut by 115 points each starting May 14, initially for 90 days, US Treasury Secretary Scott Bessent said on Monday after negotiations with the Chinese side in Geneva. Tariffs on most Chinese exports to the US are then expected to fall to 30 percent, and surcharges on US exports to China to 10 percent.
According to Chinese sources, both sides agreed to establish a mechanism for consultations on economics and trade, as Vice Premier He Lifeng said, according to Chinese state media. The meeting in Geneva was an important step toward resolving differences through dialogue and laid the foundation for deepening cooperation.
"This is good news," said Holger Schmieding, chief economist at Berenberg Bank. "Without this pause, direct trade between the US and China would have virtually come to a standstill." According to Schmieding, China has largely prevailed with its tough stance of retaliating against the US tariffs with tariffs almost as high. "Beijing has forced the US to the negotiating table."
Dax gains, gold price fallsStock markets reacted to the news from Geneva with price gains. Germany's leading index, the DAX, rose as much as 1.8 percent to 23,911.98 points after opening on Monday, reaching its all-time high. At the same time, it targeted the psychologically important 24,000-point mark.
The price of gold, however, fell significantly. This morning, the price for one troy ounce (approximately 31.1 grams) fell to around $3,233, trading about $91 lower than on Friday. However, analysts do not anticipate further significant declines in the price of gold. Commodity expert Robert Rennie of the Australian Westpac Banking Corporation expects investors to buy more at prices around the $3,200 mark.
The gold price last reached a record high of $3,500 per ounce in mid-April. At that time, concerns about the potential consequences of aggressive US tariff policy drove the price of gold.
AFP/rtr/dpa/kb
capital.de
