USA-China Trade Truce Eases Recession Fears as Markets Turn Risk-On
A fresh 90-day trade truce between the U.S. and China has shifted market sentiment, leading to a sharp decline in recession forecasts and a wave of optimism across financial and crypto sectors.
The temporary suspension of tariffs—cutting U.S. duties on Chinese imports to 30% and reducing China’s tariffs on American goods to 10%—has slashed the probability of a 2025 U.S. recession from over 70% to just 40%, according to data from the Kalshi prediction market.
Officials from both sides met in Geneva, where Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng signaled a mutual retreat from economic decoupling. The agreement marks a clear pivot from the hardline trade standoff that had gripped both economies.
Markets welcomed the news. Equities ticked higher and Bitcoin briefly soared past $105,000 before settling near $103,000. Analysts attributed the move to improved risk sentiment and expectations that global liquidity may continue to loosen.
Moody’s economist Mark Zandi had previously warned of a downturn, but the trade deal appears to have eased some of the pressure. Meanwhile, investors are watching closely to see if other nations follow suit in easing trade barriers—moves that could further stabilize the global economic outlook heading into 2025.
Alexander Stefanov
Reporter at Coindoo
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over 8 years of experience covering the crypto, blockchain and fintech industries, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics.
