US and Chinese officials will meet to 'break the ice' in Geneva

News of the meeting, released late on May 6, sent US stock index futures soaring as trading resumed after two consecutive days of declines on Wall Street due to uncertainty surrounding US President Donald Trump's "tariff tsunami". S&P 500 emini futures rose about 1%.

The meeting with the Chinese vice premier will come after months of escalating tensions that have seen trade tariffs between the world's two largest economies soar beyond 100%. It is the first meeting between senior Chinese and US officials since US Senator Steve Daines met Premier Li Qiang in Beijing in March.

The two sides are expected to discuss broader tariff cuts, two sources familiar with the plan told Reuters. Negotiating teams are also expected to discuss eliminating tariffs on specific products, the sources said, citing U.S. policy onde minimis(the value threshold below which imported goods are exempt from duty) and the US export control list.

China's State Council did not immediately respond to a faxed request for comment from Western media.

Washington and Beijing have been locked in a cat-and-mouse game over tariffs, with each side unwilling to be seen as making concessions in a trade war that has roiled global markets and upended supply chains, Reuters reported.

The Office of the US Trade Representative (USTR) and the Treasury Department said Mr. Greer and Mr. Bessent will travel to Geneva together on May 8 and will also meet with Swiss President Karin Keller-Sutter to discuss bilateral trade negotiations.

"My sense is that this meeting will be about de-escalation," Mr. Bessent told Fox News Channel's "The Ingraham Angle" after the announcement. "We have to de-escalate before we can move forward."

Following the US announcement, a Chinese Commerce Ministry spokesman confirmed that China had agreed to meet with US envoys.

"On the basis of fully considering global expectations, China's interests, and the calls of US industry and consumers, China has decided to re-engage with the US," the Chinese statement said.

"There is an old Chinese saying: Listen to what is said, and act accordingly. ... If (the US) says one thing and does another, or tries to use the negotiations as a cover to continue coercion and blackmail, China will never agree."

Mr. Trump and his trade team have sent mixed signals about progress in talks with major trading partners rushing to cement deals with Washington and avoid heavy import tariffs on their goods.

Mr. Bessent told lawmakers earlier in the day that the Trump administration was negotiating with 17 major trading partners, but not China, and could announce trade deals with some of them as soon as this week.

Mr. Trump told reporters before a meeting with Canadian Prime Minister Mark Carney that he and top administration officials would review potential trade deals over the next two weeks to decide which ones to accept, causing a plunge in stock prices.

Mr. Bessent told Fox News that the two sides will work at the meeting on May 10 to determine "what to discuss."

“Look, we have a common interest that this is unsustainable,” Mr. Bessent said. “And 145%, 125% is equivalent to an embargo. We don’t want decoupling. What we want is fair trade.”

The trade deficit is increasing.

Mr. Trump and top officials have held a series of meetings with trading partners since Mr. Trump announced 10% tariffs on most countries on April 2, with higher tariffs set to take effect on July 9 unless separate trade deals are in place. Mr. Trump also imposed 25% tariffs on autos, steel, and aluminum, 25% tariffs on Canada and Mexico, and 145% tariffs on China, with further tariffs expected to hit pharmaceuticals in the coming weeks.

China has responded by raising tariffs on US goods to 125%. The European Union (EU) is also preparing countermeasures.

“I look forward to productive talks as we work toward rebalancing the international economic system to better serve American interests,” Mr. Bessent said in a statement.

Mr Trump’s tariff moves, which he said were aimed in part at reducing the US trade deficit, have so far had the opposite effect. The US Commerce Department said on May 6 that the trade deficit jumped to a record in March as businesses rushed to import goods before tariffs took effect. The data underscored a dynamic that helped push gross domestic product (GDP) into negative growth territory in the first quarter of 2025 for the first time in three years.

In particular, drugmakers’ efforts to stay ahead of Trump’s threatened tariffs on the industry have led to a record surge in pharmaceutical imports. But it’s worth noting that the US trade deficit with China has narrowed significantly as Trump’s heavy tariffs have sharply reduced Chinese imports.

"Landing zone" for UK deal

The United States and Britain have made good progress in negotiating a trade deal that could potentially include lower tariff quotas on steel and cars, a British official said, warning it was too early to predict when the deal would be signed.

The talks, led by the USTR and the Commerce Department on the US side, are expected to result in lower tariff quotas for steel and cars, while talks continue on the UK's digital services tax, the official added.

Ahead of his meeting with Mr Carney, Mr Trump said the US-Mexico-Canada Agreement (USMCA), signed during his first term and scheduled to be reviewed next year, could be renegotiated, although he questioned whether that was “really necessary”.

Mr Carney later told reporters that no decision was made on tariffs during his meeting with Mr Trump.