United States President Donald Trump has extended the suspension of tariffs imposed on China for another 90 days. The tariff suspension was initially set to expire on 12 August, but Trump has now decided to extend it. He has signed an order to this effect. This means the tariffs imposed on China will remain suspended until 10 November.
At one point, Trump was adamant about increasing tariffs against China to as much as 245%. Now, why has he softened his stance against the ‘Dragon’? Let's consider the possible reasons.
Whenever Trump threatened China with tariffs, China responded in kind. Trump’s tariff threats were met with China’s own threat of 125% tariffs on American goods. This response from China may have been unexpected by Trump.
This decision by Trump is also being attributed to the aim of promoting trade talks between the two countries. Trump wants a trade deal between the US and China that benefits America.
High tariffs on Chinese goods during the Christmas and holiday season in the US could lead to increased prices, impacting consumers and small businesses. This could be politically damaging for the Trump administration.
Some experts believe this decision is a result of pressure from China and America’s economic constraints. Chinese goods are cheap and popular in the American market.
