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US-China Trade Talks End Without Breakthrough, Awaiting Trump's Decision

WHAT'S THE STORY?

What's Happening?

The latest round of trade talks between the U.S. and China concluded in Stockholm without major breakthroughs, despite being described as constructive by both sides. The discussions focused on economic issues, rare earths, and the implementation of previously agreed terms. The U.S. emphasized the need to de-risk strategic industries such as rare earths, semiconductors, and medicines. The talks come as a tariff truce established in May is set to expire next month, potentially reviving the turmoil seen in April when both countries exchanged escalating tariffs.
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Why It's Important?

The expiration of the tariff truce could lead to increased tariffs, impacting global supply chains and financial markets. The U.S.-China trade relationship is critical, given China's role in supplying rare earths, essential for technology and defense industries. The decision to extend the truce rests with President Trump, whose previous trade deals have influenced international trade dynamics. The talks also highlight ongoing tensions between the U.S. and China over economic models and national security concerns, with the U.S. pressing China on its dealings with Russia and Iran.

What's Next?

President Trump will decide whether to extend the tariff truce, with another round of talks likely within 90 days. The potential for a meeting between Trump and Xi Jinping later in the year remains, although Trump has denied actively seeking such a meeting. The International Monetary Fund has flagged the potential rebound in tariff rates as a major risk to global growth, emphasizing the importance of a resolution.

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