US and China Ease Tariffs: A 90-Day Pause Signals Global Trade Shift

The US China tariff reduction 2025 is now official. The United States and China have agreed to a 90-day pause on reciprocal tariffs starting May 14, 2025. This temporary reduction is expected to ease tensions and stimulate trade between the two largest global economies.

According to the official White House announcement, the United States will reduce tariffs on Chinese goods from 145% to 30%. This includes a 20% IEEPA tariff and a 10% baseline duty. In response, China will cut tariffs on US goods from 125% to 10%.

Although detailed guidelines on applicability (e.g., departure/arrival dates) have not yet been released, this move marks a significant turning point in global trade relations.

Broader Trade Impacts

In addition to the US-China agreement, a new trade deal between the US and the UK has also been confirmed. While most imports from the UK will continue to face a 10% reciprocal tariff, favorable terms have been negotiated on section 232 tariffs covering steel and aluminum.

Notably, the deal will benefit the US food and ethanol industries, opening access to the UK market worth approximately $5 billion. The first 100,000 vehicles imported from the UK to the US will be subject to just the 10% tariff—any additional imports will revert to a 25% rate.

Industry-Specific Gains

Pharmaceutical supply chains between the US and UK are expected to be more secure and streamlined as a result of this new trade cooperation. Meanwhile, tariffs between the US and Canada/Mexico remain at 25%, unless covered under the USMCA, which allows tariff-free movement.

The 90-day reciprocal tariff pause for other countries remains in effect until around July 8, with most imports currently benefiting from a 10% reduced rate.