US-China trade talks 'stalled', Bessent says

“They have a good relationship… and I am confident the Chinese will come to the table when President Trump makes his preferences known.”

Talks between the US and China on a permanent trade agreement have “stalled” following the recent 90-day tariff truce, Treasury Secretary Scott Bessent revealed Thursday in an interview with Fox News. He stressed that a breakthrough now likely depends on direct talks between President Donald Trump and China’s President Xi Jinping.

“I would say that they are a bit stalled,” Bessent told Fox News’ Bret Baier.
“I believe that we will be having more talks with them in the next few weeks, and I believe we may at some point have a call between the president and party chair Xi.”

High Stakes, Personal Diplomacy

“Given the magnitude of the talks, given the complexity – this is going to require both leaders to weigh in with each other,” Bessent said.
“They have a very good relationship, and I am confident that the Chinese will come to the table when President Trump makes his preferences known.”

The temporary truce, struck in Geneva earlier this month, reduced US tariffs on Chinese goods from 145% to 30%, while China lowered its own tariffs from 125% to 10%. But the deal left unresolved the broader structural issues — particularly around China’s export-driven model — which Trump has long criticized.

EU Moved Fast After Tariff Threats

Bessent also hinted that other major trade agreements were nearing completion — notably not with China.

“There are a couple of very large deals that are close. A couple of them are more complicated,” he said.
“And as we saw with the president’s threat of 50% tariffs last Friday, the EU came to the table very quickly over the weekend — so now we’ve got the EU in motion also.”

Legal Drama Over Trump’s Tariffs

A federal trade court ruling earlier this week dealt a blow to Trump’s tariff regime, saying he overstepped his emergency powers under the International Emergency Economic Powers Act. The court blocked key parts of his sweeping 10%, 20%, and 25% tariffs on countries including China, Canada, and Mexico.

However, a federal appeals court quickly paused that decision, effectively reinstating the tariffs while the appeal process plays out. The court ordered both parties to submit written arguments by early June.

“We’ve seen no change in [US trading partner] attitude in the past 48 hours,” Bessent noted.
“As a matter of fact, I have a very large Japanese delegation coming to my office first thing tomorrow morning.”

Trump himself expressed confidence that the Supreme Court will ultimately allow his tariffs to proceed and suggested he could use other legal mechanisms to continue his trade agenda regardless of court rulings.

Global Market Reactions

Asian markets fell Friday morning on the news that US-China talks were stalling and Trump’s tariffs were reinstated. Chinese stocks led the declines:

Shanghai Composite: -0.7%
Hang Seng: -1.5%
CSI 300: -0.5%

Technology shares slid across Asia as initial optimism from Nvidia’s earnings faded under growing trade concerns.

Meanwhile, Japan’s Nikkei 225 fell 1.3% following hotter-than-expected Tokyo inflation data, stoking expectations of a July rate hike. The yen firmed, further pressuring Japanese equities.

While Trump’s team remains optimistic, the path to a permanent US-China trade deal looks more complex than ever. With legal uncertainty swirling around tariff authority and markets reacting sharply to every move, Bessent made it clear: this is a moment that requires the full weight of presidential diplomacy.