US and China Extend 90-Day Trade Deal to Avoid Tariff Hikes

In a move aimed at easing trade tensions, the United States and China have agreed to extend their trade agreement by another 90 days, averting potentially damaging tariff hikes that could have worsened the global economic slowdown.

The decision, announced on August 11, 2025, followed an executive order signed by President Donald Trump, keeping US tariffs on Chinese imports at 30%—while China maintains its tariffs on US goods at 10%. Without the extension, these tariffs were set to surge to 145% and 125%, respectively.

The current truce stems from negotiations in Geneva earlier this year, where both sides agreed to address concerns over:

• A $300 billion US trade deficit with China recorded in 2024.

• Market access for American companies in China.

• Technology transfer and national security concerns.

While the deal provides breathing space for businesses, uncertainty remains. American entrepreneurs, like Beth Benike, founder of Busy Baby, have expressed worries that unpredictable trade policy shifts continue to complicate pricing strategies and long-term planning.

Economists note that while this extension prevents immediate economic shocks, it is only a temporary fix—and without a more comprehensive trade framework, tensions could resurface once the 90 days expire.