US to reduce 'de minimis' tariff on China shipments to 54%, down from 120%.

de minimis" tariff on shipments from China from 120% to 54% marks a significant shift in trade policy, effective May 14th . This adjustment, communicated through a White House executive order, reflects an attempt to recalibrate economic relations with China while addressing consumer concerns regarding high import costs. The de minimis threshold—previously set at $800—will not be reinstated, which limits the potential for low-cost imports to enter without incurring tariffs .

They are arguing that their defiant public posture worked and was a major reason they were able to strike a deal with U.S. officials in Switzerland with relatively few concessions.

China’s firm countermeasures and resolute stance have been highly effective,” said a social media account linked to China’s national broadcaster CCTV.

In the eyes of the Chinese public, negotiators from Beijing appear to have convinced President Donald Trump’s administration to roll back most of the 145% tariff rate that Trump imposed, and slash them to 30%.

In exchange, China pledged to roll back most of the countertariffs it announced against the U.S.

US and China, because of the deeply intertwined relationship between American and Chinese technology sectors. Apple (AAPL) gained 6.3%, Tesla (TSLA) rose 6.75%, Nvidia (NVDA) was up 5.4%, Amazon (AMZN) rose 8.1% and Intel (INTC) was up 3.55%.

Stocks of luxury goods makers, which had tumbled in recent months, bounced back sharply: Hermes rose 3.5%, Burberry was up 3.67% and LVMH surged 7%.

The number of shipments entering the U.S. through the tax-free channel exploded in recent years with more than 90% of all packages coming via de minimis. Of those, about 60% came from China, led by direct-to-consumer retailers such as Temu and Shein.

Temu, Shein and Amazon did not immediately respond to requests for comment.

In conclusion, while the reduction of the de minimis tariff signals a potential thawing in U.S.-China trade tensions, it simultaneously underscores ongoing challenges that consumers and businesses will face as they navigate this complex economic landscape. Future evaluations of this policy may provide insight into its long-term implications for international trade relations .

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Sarah H

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