30.10.25 - US-China trade truce
President Trump and Chinese leader Xi Jinping concluded a closely watched summit, formally announcing a 1-year truce in the trade and tariff dispute between the world’s two largest economies. The agreement pauses escalating measures that had weighed on global markets in recent months.
Talks centered on US tariffs and China’s export controls on rare earth materials. The deal includes a mutual freeze on additional port fees for 12 months and a temporary suspension of China’s rare earth export restrictions.
Further key points include:
US tariff rate on certain China-linked goods, including fentanyl-related products, reduced from 20% to 10%, with a pledge from Beijing to curb illicit shipments
Broad US tariffs on Chinese goods lowered from 57% to 47%
Trump declared rare-earth concerns “settled”
US will mediate between Beijing and Nvidia regarding chip export issues
China to increase US energy purchases, with specific reference to Alaskan oil and gas
China to resume large-scale soybean buying “immediately”
Markets: profit taking in combination with earings
Global stocks trading negative
US yields higher (after Fed policy meeting) with the 10-year yield around 4.1%
US dollar: stronger
Gold: regains ground trading around the USD 4’000/oz level
Cryptos: trading negative
My View: This outcome: relief, but not resolution. As predicted in my earlier comments this week, investors traded the classic playbook: buy the rumor, sell the fact.
A temporary truce reduces tail risk for now and supports risk assets in the short term, yet deeper structural issues remain untouched.
I doubt this represents genuine one-year stability. Geopolitical and economic competition between the US and China runs far beyond tariffs and soybeans. The pause may cool sentiment for a few months, although I expect renewed friction and policy noise as both sides defend strategic priorities.
Commodities stay in the spotlight. Energy, industrial metals, and strategic materials will continue to play a critical role in geopolitical positioning and supply chain security. Volatility will resurface whenever headlines shift from diplomacy back to confrontation.
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