US-China trade deal key losses are becoming more and more apparent right now as both nations have just recently announced a rather surprising 90-day tariff reduction agreement. This unexpected development marks a significant shift in Trump’s trade war strategy.

The cutbacks on reciprocal tariffs negotiated over in Geneva during the weekend produced a rollback of the tariffs reduction from a whopping 125% down to a meager 10% – with experts at this point regarding such a move as an evident victory over Beijing rather than a win for Washington. Markets have reacted with huge excitement to the news as global stocks soared massively on Monday. The S&P 500 jumped an impressive 3.26%, also the technology-laden Nasdaq Composite jumped even higher at 4.35%.

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Key Losses for the U.S. in the Latest US-China Trade Deal and Market Reactions

US-China’s trade deal key losses became evident after many months of escalating tensions. While Trump claimed the deal represented progress in America’s “decoupling” from China, the available evidence suggests that Beijing may have actually secured the upper hand in these negotiations. Chinese officials and state-run media were quite quick to frame the agreement as a vindication of their strategy.

China’s Strategic Victory

A social media account linked to China’s national broadcaster CCTV stated:

“China’s firm countermeasures and resolute stance have been highly effective.”

Foreign Minister Wang Yi had previously said in March 2025:

“No country should fantasize that it can suppress China and maintain good relations with China at the same time. Such two-faced acts are not good for the stability of bilateral relations, or for building mutual trust.”

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Global Perception Shifts

The timing of this deal coincides with a dramatic shift in international perceptions. According to the latest Democracy Perception Index, more countries now view China favorably than the United States for the first time in the survey’s history. America’s rating dropped from +22% to -5%, while China’s stands at +14%.

Anders Fogh Rasmussen, Chair of the Alliance of Democracies Foundation and former NATO Chief, commented:

“I’m not surprised that perceptions of the United States have fallen so sharply, although I find it reassuring that support for the rules-based international order remains strong around the world.”

Economic Implications for American Consumers

US-China’s trade deal key losses also extend to American consumers in ways that might not be immediately obvious. Economic experts are warning that prices may still rise despite the reduction.

Rick Muskat, president of shoe retailer Deer Stags, was clear about the fact that:

“Our costs will go up closer to 40%. So we will have to raise prices for fall deliveries.”

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New Baseline Tariffs Set Concerning Precedent

According to Deborah Elms, director of the Trade Policy Project at the Hinrich Foundation, albeit dismantling the most punitive tariffs, the rollback leaves a new 10% starting point for US imports, far above the 2% average that took effect in early 2024. Such alteration, which may appear insignificant at first sight, may have long-term implications for the American trade policy.

Temporary Relief Amid Lingering Uncertainty

Stuart Rumble, Head of Investment Directing at Fidelity International, described the agreement as a:

“Short-term reprieve that sends an encouraging signal to markets and helps restore some confidence.”

The 90-days agreement is a considerable de-escalation but the key losses of the US-China trade deal imply that this is rather a strategic retreat than a victory. The Trump trade war fallout continues to be calculated not only in terms of economics but in global clout where China seems to be gaining at America’s expense. And, well, the trade war consequences of Trump have also restructured world trade dynamics, probably setting disturbing precedents for negotiations with another partner in the future. Besides, the ripple from Trump’s trade war impact may be felt across the world in the markets for months and years to come.

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