Global Markets Surge Amid Hopes of US-China Trade Truce
On May 2, 2025, global markets experienced significant gains driven by indications that China and the United States may resume trade negotiations. The appreciation of Asian currencies and investor optimism reflect the potential easing of tariff tensions between the world's two largest economies.
The US and China have been engaged in a damaging trade spat
Global Markets Surge Amid Hopes of US-China Trade Truce
On May 2, 2025, global markets experienced significant gains driven by indications that China and the United States may resume trade negotiations. The appreciation of Asian currencies and investor optimism reflect the potential easing of tariff tensions between the world's two largest economies.
On Friday, May 2, 2025, global financial markets responded positively to signs that trade tensions between the United States and China may be easing. China's Ministry of Commerce announced it is "evaluating" recent U.S. proposals to initiate new trade negotiations, provided Washington demonstrates "sincerity," including the removal of tariffs imposed on Chinese goods.
The prospect of renewed talks boosted stock markets: the U.S. S&P 500 index rose 1.4%, recovering recent losses; in Europe, Germany's DAX advanced 2.4%, and France's CAC 40 gained 1.8%. In Asia, Taiwan's Taiex index climbed 2.7%, and Hong Kong's Hang Seng increased by 1.7%.
In the currency market, Asian currencies such as the Chinese renminbi and South Korean won appreciated against the U.S. dollar. The Taiwanese dollar experienced its most significant surge in nearly four decades, driven by positive economic data and expectations of eased trade tensions.
Investor optimism also impacted oil prices, which fell due to caution ahead of the OPEC+ meeting and the potential resumption of U.S.-China trade negotiations.
The trade war between the U.S. and China, intensified at the start of Donald Trump's second term, resulted in significant tariffs imposed by both countries. Currently, the U.S. applies tariffs of up to 145% on Chinese products, while China imposes 125% tariffs on American goods.