Global markets responded with strong enthusiasm after the United States and China agreed to a 90-day rollback of harsh trade tariffs. The deal, which significantly reduces duties on both sides, has lifted investor sentiment worldwide—fueling a sharp rebound in stock markets, strengthening the US dollar, and driving Bitcoin and other cryptocurrencies closer to record highs.
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US and China Strike Temporary Trade Agreement
Following high-level negotiations in Geneva, US and Chinese officials announced a temporary truce in their long-standing trade dispute. The US will reduce tariffs on Chinese imports from 145% to 30%, while China will cut its duties from 125% to 10%, effective May 14. The agreement marks a major de-escalation and opens a 90-day negotiation window aimed at finding a more lasting resolution.
Both nations emphasized their commitment to economic cooperation. “What has occurred with these very high tariffs was an equivalent of an embargo. Neither side wants that,” said US Treasury Secretary Scott Bessent.
Global Stock Markets Rally
Stock markets around the world surged in response to the news. On Wall Street, the S&P 500 jumped 3.3% and Nasdaq climbed 4.4%, its best session in over a month. Futures contracts on the S&P 500 and Nasdaq 100 also soared, reflecting expectations for continued momentum.
European indices followed suit: Germany’s DAX hit a record high, while Italy’s FTSE MIB reached its highest level since 2007. In Asia, the Hang Seng Index in Hong Kong closed nearly 3% higher.
Oil prices rebounded as well, with Brent crude futures rising to $65.69 per barrel and WTI crude climbing 3% to $62.90, as trade fears subsided.
“This is a textbook recovery after sharp declines in recent weeks,” said Gina Bolvin of Bolvin Wealth Management Group. “It’s a win for markets and a temporary reset in global risk.”
US Dollar Strengthens, Safe Havens Retreat
The US dollar rallied, gaining 0.9% against major currencies and nearly 2% against the Japanese yen. The euro and Swiss franc weakened as demand for safe-haven assets declined. Meanwhile, gold prices dropped nearly 3%, falling to $3,227 an ounce after peaking at $3,500 last month.
Bond yields rose amid reduced recession fears. The US 10-year Treasury yield hit a one-month high of 4.447%, while German and British government bonds also faced selling pressure as investor appetite shifted toward risk assets.
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Bitcoin and Altcoins Rally on Improved Sentiment
Bitcoin climbed to $103,918—just 4.8% below its all-time high—leading a broader rally in digital assets. Altcoins such as Ethereum and Solana also posted gains, as analysts noted a shift back into high-risk, high-reward investments.
According to analysts at Nansen and Cointelegraph, Bitcoin’s resilience throughout the trade war helped solidify its position as a macro hedge. With tensions easing, altcoins and US equities are expected to “catch up” in performance.
“We could see Bitcoin push toward $150,000 if the current bull flag pattern confirms,” said Aurelie Barthere, a crypto analyst at Nansen.
Tax Relief Hopes Could Fuel Further Gains
In addition to the trade deal, market optimism is being bolstered by speculation that the US may introduce a sweeping tax relief package by mid-July. Proposals include expanded personal tax cuts, corporate tax reductions, and renewed business incentives.
Analysts believe this could serve as a second catalyst for both equities and cryptocurrencies, compounding the gains from the tariff truce.
Outlook: Optimism Meets Caution
While investors are cheering the breakthrough, market experts warn the situation remains fragile. With US tariffs still elevated at 30%, the global economy is not yet in the clear.
“There’s no full reset on recession risks,” said Sheldon MacDonald of Marlborough Asset Management.
“This trade drama is far from over. Think of it as a mix of Chinese opera and American soap opera—lots of drama, and no clear ending yet,” added fund manager Simon Edelsten.
Conclusion
The 90-day tariff relief agreement between China and the US has brought much-needed optimism to global markets. Stocks are rallying, the dollar is strengthening, and Bitcoin is nearing new highs. However, this is a temporary ceasefire, not a permanent peace. Until a long-term deal is signed, investors will remain cautiously optimistic.
