U.S. and Chinese officials announced a tentative framework to revive their stalled trade truce, focusing on lifting export restrictions and retaliatory tariffs that have strained global markets. After two days of negotiations in London, U.S. Commerce Secretary Howard Lutnick and China’s Vice Commerce Minister Li Chenggang confirmed a preliminary deal that will ease China’s export bans on rare earth minerals and some U.S. restrictions on semiconductor and aviation products.

This agreement builds on a prior Geneva consensus but had faltered over China’s mineral export curbs and U.S. countermeasures. The new framework, now pending presidential approval in both countries, is seen as a cautious step forward rather than a resolution of deeper disputes over tariffs and trade practices.

Markets responded tepidly, as investors await details on implementation. Rare earth-related Chinese firms saw gains amid signs that export licenses were being reinstated. However, broader issues, like Trump’s unilateral tariffs and China’s state-driven economic model remain unresolved. The sides have until August 10 to finalize a more comprehensive deal, or punishing tariffs will resume.

The World Bank cited rising tariffs and uncertainty as major global economic headwinds, cutting its 2025 growth forecast. Meanwhile, China’s exports to the U.S. plunged over 34% in May, highlighting the ongoing economic fallout from the prolonged trade conflict.