The United States and China announced an agreement Monday to suspend the majority of tariffs on each other’s goods and a 90-day truce during a joint news conference in Geneva

The U.S. will reduce its tariff on Chinese goods from 145% to 30%, and within that, will lower its 125% reciprocal tariffs on Chinese goods to 10%. Meanwhile, China plans to cut its tariff on U.S. goods by a similar 115 percentage points, bringing it down to 10%. U.S. Trade Representative Jamieson Greer detailed the figures in a news conference Monday morning after a meeting with Chinese officials.

The measures are set to take effect Wednesday.

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A joint statement released by both countries said China also agreed to halt or eliminate additional measures it had implemented since April 2 in response to the tariffs. However, the U.S. will retain a 20% tariffs tied to fentanyl, and tariffs that predate President Trump’s second term will remain in effect.

U.S. Treasury Secretary Scott Bessent said the 90-day agreement doesn’t include any broad sector-specific tariffs that have been levied against all trading partners, and that no discussions have happened regarding currencies.

“The consensus from both delegations this weekend is neither side wants a decoupling. And what had occurred with these very high tariff … was an embargo, the equivalent of an embargo. And neither side wants that. We do want trade,” Bessent said in response to the tariff announcement.

“This initiative aligns with the expectations of producers and consumers in both countries and serves the interests of both nations as well as the common interests of the world,” China’s Commerce Ministry added when speaking to reporters.

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Markets responded quickly to the news of the tariff suspension, with S&P 500 futures rising 2.6% and the Dow Jones Industrial Average climbing 2%. Oil prices jumped by more than $1.60 per barrel, while the dollar strengthened against both the euro and the Japanese yen.

Read more about the impact of recent tariffs on distribution:

• 3 Practical Ways Distributors Can Successfully Manage Tariffs — April 28 (MDM Article)
• A Few Words on Elasticity, the Future of Tariffs and Distributors’ Response — April 9 (MDM Premium)
• Distributors Forecast Shaky 1-10% COGS Increase with Tariffs Influence — April 21 (MDM Premium)
• How Are Distributors Combatting Higher Costs from Tariffs? Here’s What They Told Us — April 18 (MDM Premium)
• Who Wins and Loses in the Tariffs New Normal? — April 4 (MDM Premium)