Will Trump pivot again?

The behavior of global capital markets, particularly in Europe and East Asia, has been heavily influenced by the tariff-driven trade dispute between Washington and Beijing. In this context, bilateral negotiations between the United States and China have raised hopes among small and large investors in European markets for a sustainable agreement between the two main parties involved, who also happen to be Europe’s primary import and export partners.

However, the key question remains: Will such a sustainable agreement truly materialize, or will we face further crises along the way? Pascal Donohoe, Ireland’s Finance Minister and President of the Eurogroup (finance ministers of EU member states), in an exclusive interview with Euronews, welcomed the U.S.-China agreement to significantly reduce tariffs for 90 days, calling it a promising development in EU-U.S. relations.

The basis for this "hope" is not hard to discern. After weeks of intense economic tensions, the United States and China agreed to substantially lower the tariffs they had imposed on each other—a decision signaling a de-escalation in one of the world’s most critical trade relationships. The U.S. had previously imposed tariffs as high as 145% on Chinese goods, raising concerns about prolonged disruptions to global trade flows.

Recently, in an official White House announcement, President Donald Trump spoke of a “complete reset” in U.S.-China relations. However, experience shows that a decision announced at the White House does not necessarily translate into implementation. A clear example is the Ukraine war, where Trump claimed he would secure a ceasefire agreement between Moscow and Kyiv within 24 hours, yet four months later, he speaks of a deadlock in ceasefire negotiations.

In the U.S.-China trade and tariff war, the parties have taken steps toward “de-escalation,” but this does not mean a return to the pre-Trump era. Under the new agreement, both countries will reduce tariffs for 90 days. Trump also stated that he does not expect the 145% tariff rates to return. However, the U.S. president has not guaranteed an end to the economic war with China, and on the other side, Beijing remains guarded against any potential reversal by Washington in tariff negotiations.