Expectations for a US-China trade truce.

President Donald Trump began his meeting with President Xi Jinping at an air base in the port city of Busan, South Korea. This is the first face-to-face dialogue between the two leaders since 2019.

The US president expressed optimism, saying that the two sides could reach a trade truce agreement, although he acknowledged that "Xi Jinping is a very tough negotiator."

The meeting took place after Trump's whirlwind tour of Asia, where he announced several trade advances with Japan, South Korea, and Southeast Asian nations.

During the talks, President Xi Jinping, speaking through an interpreter, said that it is normal for the world's two leading economies to sometimes clash, but affirmed that China is ready to work with the US to build a more stable foundation for bilateral relations. Earlier, the negotiating teams from both sides had reached a "basic consensus" on addressing each other's main concerns.

News of the meeting caused the yuan to rise to its highest level in nearly a year, while global stocks from New York to Tokyo simultaneously hit record highs, reflecting expectations of a de-escalation of the trade war.

The trade war was reignited earlier this month when Beijing proposed expanding restrictions on the export of rare earth minerals, essential materials for high-tech industries. In response, Trump threatened to impose 100% tariffs on Chinese goods and restrict exports of products containing American software to the country.

Ahead of the conference, US Treasury Secretary Scott Bessent said he expected China to postpone rare earth controls for a year and resume imports of US soybeans, a crucial step for American farmers.

Trump revealed he wants to reduce tariffs on Chinese goods if Beijing commits to controlling the supply of precursor chemicals used to produce fentanyl, a synthetic drug that has caused tens of thousands of deaths in the US. He also mentioned the possibility of signing an agreement regarding TikTok, the Chinese social media app that is threatened with a ban in the US if it does not separate from its original owner.

The interim agreements on tariffs and rare earth minerals, which had significantly reduced retaliatory tariffs between the two countries, are set to expire on November 10th. Washington is considering partially easing them in exchange for Beijing's cooperation in combating fentanyl trafficking.

Although President Trump hopes to make concrete progress soon, observers believe the path to a sustainable trade agreement remains fraught with obstacles.

The world's two largest economies are fiercely competing not only in trade but also in technology and geopolitical influence. However, the meeting in Busan is seen as the first positive sign, opening the door to a de-escalation of the US-China trade war.