Tariff Truce? Must-Know Facts About the New U.S.–China Trade Deal

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After months of tariff brinkmanship, threats, and cold diplomacy, the U.S. and China have hammered out a framework deal in London.

It’s not the sweeping reset markets hoped for—but it’s a start.

Prediction market traders are trying to figure out what the rate might be (markets have it between 30 and 39%, while Trump said 55%).

The agreement reins in some of the chaos, gives both sides room to breathe, and, if finalized, could stop a trade war from boiling over into a full-on economic firestorm.

Here’s what you need to know.

China Reopens the Rare-Earth Tap

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As part of the deal, China agreed to ease export restrictions on rare-earth minerals and critical magnets—key components for U.S. tech, defense, and manufacturing. That’s a big win for Washington’s supply chain headaches.

Education Access Gets a Boost

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The U.S. will lift some visa restrictions and hurdles for Chinese students—part of a broader effort to stabilize academic and scientific ties that were fraying fast. Think soft power with strategic benefits.

Tariffs Stay Brutal

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The U.S. will maintain a punishing 55% effective tariff rate on Chinese goods, combining Trump’s earlier 25% tariffs with his newer 10% fentanyl-linked ones and more. China holds at 10%. Nobody’s blinking yet.

Trump: “Deal’s Done… Kinda”

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Trump declared the deal “done, subject to final approval with President Xi.” Translation: it’s a handshake, not a signature. Until the photo op happens, everything’s technically up in the air.

Markets Shrug

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The Dow barely moved. Investors know the difference between a treaty and a PR play. This deal doesn’t roll back a single tariff. It just signals that no new ones are coming—for now.

Strategic Tensions Still Simmer

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This agreement dodges the hard stuff: semiconductors, AI, military tech, and critical U.S. export bans. The economic cold war isn’t over—it’s just cooling while the diplomats catch their breath.

A Nod to Geneva, Not a Reset

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This deal borrows language from the Geneva framework talks that stalled earlier this year. It’s a diplomatic do-over—but with the same sticking points waiting just beneath the surface.

Follow-Up Summit Incoming

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Officials hinted at a second round of talks and a potential presidential summit. But there’s no date, no agenda, and no guarantee it won’t implode before takeoff.

A Pause, Not a Peace

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This is a ceasefire, not a peace deal. No new tariffs, some diplomatic smiles, but all the old fractures are still in place. Trade war fatigue set in—this just buys time.

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