Tariff Truce Sparks Market Rally and Opportunity for Buyers and Sellers

Following intensive negotiations held in Geneva on May 12, the U.S. and China revealed a 90-day agreement to reduce tariffs—a move aimed at pausing an escalating trade conflict between the two nations. Speaking after the Geneva discussions, U.S. Treasury Secretary Scott Bessent described the deal as a meaningful breakthrough, highlighting that both countries made a sincere effort to safeguard their economic goals while finding common ground. He emphasized that although the pause is limited to 90 days, it reflects a broader commitment to finding common ground.

Jamieson Greer, the U.S. Trade Representative present at the Geneva meetings, explained that America’s tariff rate on Chinese goods would be reduced from 145% down to 30%, effectively reversing 115 percentage points of the previous hike. China, in turn, will match that reduction by scaling down its tariffs from 125 percent to 10 percent, while also eliminating several retaliatory trade restrictions. According to Greer, this agreement was designed to restore a degree of stability and open the door for further cooperation in the coming weeks.

The short-term rollback may not signal the end of trade tensions, but it significantly cools what had become an increasingly aggressive economic standoff. Both sides are now working within what’s being informally called the “Geneva Mechanism”—a new diplomatic channel aimed at fostering ongoing dialogue.

Why the Tariff Deal Matters

This isn’t just global economic news—it impacts the financial climate closer to home. Trade uncertainty often sends ripples through financial markets, mortgage rates, and investment behavior. Already, the short-term reaction has been positive:

• U.S. stock markets responded strongly, with futures for the S&P 500 rising by 2.8% and the Nasdaq advancing 3.5%.

• Hong Kong’s Hang Seng saw a 3% uptick

• The U.S. dollar gained 1.6% in strength

• Oil prices increased while gold, a safe-haven asset, saw a 3% drop

Yields on 10-year U.S. Treasuries rose to 4.44%, which could signal potential upward movement in mortgage rates if inflation expectations increase.

What's Behind the Agreement?

While the tariff reduction is a promising sign of collaboration, it doesn’t mark a full resolution. The agreement also includes commitments to cooperate on broader concerns, such as addressing the flow of fentanyl—a priority for U.S. negotiators.

However, key issues remain. Many of the previously established tariffs from 2018 and other statutory authorities are still in place. These were originally introduced in response to longstanding grievances about intellectual property theft, forced technology transfers, and other practices that the U.S. considers unfair.

The agreement's diplomatic framework—the “Geneva Mechanism”—is intended to create a more predictable structure for ongoing dialogue. It’s a signal that both sides are willing to keep talking, which may help calm investor anxiety and economic volatility in the near term.

Real Estate and Wealth Impacts

Whether you're in the market to buy, sell, or invest in Orange County, this deal is more than a headline—it’s a signal. Let’s break down what this means for your next real estate move:

• Renewed Market Confidence: When global tensions de-escalate, investors and homebuyers often feel more secure, which can increase demand and stabilize prices.

• Watch Mortgage Rates Closely: Rising Treasury yields often foreshadow higher mortgage rates. While the recent surge to 4.44% isn't dramatic, it's worth tracking if you're planning to lock in a loan.

• A Smart Time to Act: Uncertainty creates opportunity. As markets rebalance, savvy investors often move into real estate for its long-term security and tangible value—especially in sought-after areas like Orange County.

The Bottomline

The 90-day tariff rollback between the U.S. and China isn’t just a global development—it’s a local opportunity. From influencing mortgage rates to easing inflation fears, this trade relief might be the opening buyers and sellers have been waiting for. If you're planning a move or seeking to build long-term wealth in Orange County, reach out to me at Whitestone Real Estate. Let’s turn global headlines into your next big step.

Reference: Evans, O. (2025, May 12). US and China Agree to Slash Tariffs for 90 Days. The Epoch Times.