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said the U.S. agreed to drop the 145% tax Trump imposed last month to 30%. China agreed to lower its tariff rate on U.S. goods to 10% from 125%.

A deal averts a total blockade

Greer and announced the tariff reductions at a news conference in Geneva.

The officials struck a positive tone as they said the two sides had set up consultations to continue discussing their trade issues. Bessent said that the triple-digit tariffs the two countries imposed on each other last month 鈥� in an escalation of tensions Trump started 鈥� amounted to “the equivalent of an embargo, and neither side wants that. We do want trade.’’

, escorted around town and guarded by scores of Swiss police, met for at least a dozen hours on both days of the weekend at a sunbaked 18th-century villa that serves as the official residence of the Swiss ambassador to the United Nations in Geneva.

At times, the delegation leaders broke away from their staffs and settled into sofas on the villa鈥檚 patios overlooking Lake Geneva, helping deepen personal ties in the effort to reach a much-sought deal.

Finally, a deal

The 30% levy that America is now imposing on Chinese goods includes an existing 20% tariff intended to pressure China into doing more to prevent the from entering the United States. It also includes the same 10% “baseline’’ tariff Trump has slapped on imports from most of the world’s countries. The 30% tax comes on top of other levies on China, including some left over from Trump’s first term and kept by former President Joe Biden.

Trump had ratcheted the combined tariff to 145% last month, furious that China was retaliating, before backing down Monday.

China鈥檚 Commerce Ministry called the agreement an important step for the resolution of the two countries鈥� differences and said it lays the foundation for further cooperation.

鈥淭his 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,鈥� a ministry statement said.

China hopes the U.S. will stop 鈥渢he erroneous practice of unilateral tariff hikes鈥� and work with China to safeguard the development of economic and trade relations, injecting more certainty and stability into the global economy, the ministry said.

The joint statement by the two countries said China also agreed to suspend or remove other measures it has taken since April 2 in response to the U.S. tariffs. China has increased export controls on rare earths, including some critical to the defense industry, and added more American companies to its export control and unreliable entity lists, restricting their business with and in China.

Markets rally as two sides de-escalate

The full impact on the complicated tariffs and other trade penalties enacted by Washington and Beijing remains unclear. And much depends on whether they will find ways to bridge longstanding differences during the 90-day suspension.

Bessent said in an interview with CNBC that U.S. and Chinese officials will meet again in a few weeks.

But as trade envoys from the world鈥檚 two biggest economies blinked.

Futures for the S&P 500 jumped 2.6% and the Dow Jones Industrial Average was up 2%. Oil prices surged more than $1.60 a barrel, and the dollar gained against the euro and the Japanese yen.

鈥淭his is a substantial de-escalation,鈥� said Mark Williams, chief Asia economist at Capital Economics. But he warned 鈥渢here is no guarantee that the 90-day truce will give way to a lasting ceasefire.鈥�

Dani Rodrik, an economist at Harvard University, said that the two countries had stepped back 鈥渇rom a needless trade war鈥欌�� but that U.S. tariffs on China remain high at 30% 鈥渁nd will mainly hurt U.S. consumers.鈥欌��

“Trump has obtained absolutely nothing from China for all the chaos he generated. Zilch,鈥欌�� Rodrik wrote, posting on Bluesky.

Craig Singleton, senior director of the China program at the Foundation for Defense of Democracies, said the speed at which the agreement came about suggested that 鈥渂oth sides were more economically boxed in than they let on.鈥�

鈥淔or China, the economic pain was real: Rising unemployment, capital flight, and export orders falling at their fastest rate in nearly two years,” Singleton said. “For Trump, markets mattered, and this deal gives him a win without abandoning leverage.鈥�

The announcement by the U.S. and China sent shares surging, with U.S. futures jumping more than 2%. Hong Kong鈥檚 Hang Seng index surged nearly 3%, and benchmarks in Germany and France were both up 0.7%

鈥淭he drop from sky-high to merely high tariffs, along with the uncertainty about the path of future tariffs, will still serve as a constraint on trade and investment flows between the two economies,鈥� said Eswar Prasad, professor of trade policy at Cornell University.

鈥淣evertheless, it is a positive omen for the world economy that U.S. tariffs might eventually end up as significant trade barriers but not unsurmountable walls,鈥欌�� he said.

Jay Foreman 鈥� CEO of Basic Fun, the Florida-based company behind such toys as Care Bears and Tonka trucks 鈥� said he was relieved to see the tariff rate on Chinese goods now down to 30%. But he wants that to drop to 10%.

Foreman said he’d just advised his team in China to release its toy shipments, which had been paused since early April. Before Monday’s deal, he said, he thought he’d have to double prices 鈥� but they’ll still go up, by 10% to 15% for the third and fourth quarters.

鈥淚t鈥檚 like they tried to feed us a rotten egg sandwich and hope we鈥檙e happy to drink spoiled milk instead,鈥� Foreman said.

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McHugh reported from Frankfurt, Germany; Kurtenbach from Mito, Japan; and Moritsugu from Beijing. AP Writers Paul Wiseman and Didi Tang in Washington and AP Retail Writer Anne D’Innocenzio in New York contributed.