U.S. Treasury Secretary Scott Bessent said tariffs on Chinese imports would be reduced from 145% to 30%, while China would reduce tariffs on U.S. goods from 125% to 10%. The agreement is seen as a strategic start to promote broader economic negotiations between the two sides.

Global stock markets soared after the agreement was reached, indicating optimism that the two sides could reach a long-term agreement.

After two days of talks in Geneva over the weekend, the two sides issued a statement on Monday reaffirming their commitment to "mutual respect and continued dialogue" and emphasizing that the suspension (of tariffs) is intended to create space for continued negotiations.

Bessent said: "We are not declaring victory, but this is a necessary step towards stability."

Chinese Vice Premier He Lifeng called the results of the talks "constructive" and "an important step in resolving differences through equal dialogue and consultation."

Despite the easing of tensions, economists warned that underlying problems remain unresolved. It is expected that the two sides will use the 90-day negotiation window to conduct more in-depth negotiations on intellectual property rights, technology transfer and trade imbalances.