US-China Trade War: A Call for De-escalation

US Treasury Secretary Scott Bessent advocates for a reduction in tariffs between the US and China, describing the current trade tensions as unsustainable. Although negotiations have not officially begun, Bessent predicts a challenging path ahead. The ongoing tariffs have negatively impacted markets and investor confidence.

In a significant address, US Treasury Secretary Scott Bessent labeled the ongoing tariff conflict with China as unsustainable, suggesting an imminent need for de-escalation between the two largest global economies.

During a private address in Washington for JPMorgan Chase, Bessent expressed caution, noting that formal talks between the US and China had not commenced. President Trump's imposition of a 145 percent import tax on Chinese goods—and China's reciprocal 125 percent tariffs on US products—has led to stock market declines and increased interest rates due to investor concerns over slower economic growth and inflationary pressures.

Bessent, as cited in an Associated Press transcript, remarked on the arduous nature of the negotiations with China, stating, "Neither side thinks the status quo is sustainable." The S&P 500 rose following initial reports of Bessent's comments by Bloomberg News. Despite meetings with several countries, including Japan and the EU, Trump has made no indication of retracting the baseline 10 percent tariff, although he seeks reductions in foreign import taxes and the removal of non-tariff barriers that the administration claims restrict US exports.

(With inputs from agencies.)