Key Points
- Asia-Pacific markets trade mixed amid Trump’s China deal claims
- Trump declares US-China trade deal “done,” pending approvals
- New tariffs set at 55% US, 10% China on imports
- China to supply rare earth minerals upfront to US
- China downplays deal, calls it preliminary framework
- Investors cautious, awaiting formal details and implementation
- Deal follows marathon talks in London and Geneva
- US to allow Chinese students continued access to colleges
- Market reactions reflect uncertainty over trade and geopolitics
- Analysts see deal as partial rollback of previous tariffs
Asia-Pacific financial markets showed mixed performance on June 13, 2025, as investors digested former U.S. President Donald Trump’s announcement that a comprehensive trade deal with China is “done,” pending final approval by both Trump and Chinese President Xi Jinping. The deal, emerging from intense negotiations in London and Geneva, includes a significant reduction in tariffs and provisions for China to supply rare earth minerals critical to U.S. industries. However, market participants remain cautious amid China’s tempered response and uncertainties over the deal’s final terms and implementation timeline.
Details of the US-China Trade Deal
Trump’s Announcement and Key Provisions
On June 11, Trump took to his social media platform Truth Social to declare:
“OUR DEAL WITH CHINA IS DONE, SUBJECT TO FINAL APPROVAL WITH PRESIDENT XI AND ME. FULL MAGNETS, AND ANY NECESSARY RARE EARTHS, WILL BE SUPPLIED, UP FRONT, BY CHINA.”
He detailed that the United States would impose a total tariff rate of 55% on Chinese imports, a reduction from the previous 145%, while China would apply a 10% tariff on U.S. goods. The deal also includes provisions allowing Chinese students to continue studying at American universities, a point Trump personally highlighted.
Tariff Composition
The 55% U.S. tariff rate comprises:
- A 10% baseline reciprocal tariff applicable to most trading partners
- A 20% tariff linked to fentanyl-related punitive measures
- A 25% levy from Trump’s initial term targeting Chinese imports
China’s 10% tariff marks a significant decrease from retaliatory rates as high as 125%.
Rare Earth Minerals Supply
China, which dominates global rare earth production and processing, agreed to supply these critical materials upfront. Rare earths are essential for manufacturing electric vehicles, semiconductors, defense systems, and other high-tech products.
Market Reactions in Asia-Pacific
Mixed Trading Patterns
Following Trump’s announcement, Asia-Pacific stock markets exhibited uneven performance. Some indices gained on optimism about easing trade tensions, while others declined amid skepticism over deal details and geopolitical risks.
Investor Caution
Market analysts noted that despite Trump’s confident claims, China’s official stance remained cautious, describing the agreement as a preliminary framework rather than a finalized deal. This tempered enthusiasm and led investors to adopt a wait-and-see approach.
China’s Response and Diplomatic Nuances
Downplaying the Deal
Chinese officials emphasized that the agreement was still subject to further negotiations and approvals. The Ministry of Commerce reiterated its commitment to resolving trade issues but avoided confirming Trump’s “done” characterization.
Ongoing Negotiations
The deal follows marathon talks held in London and Geneva, where both sides sought to restore a fragile trade truce after years of escalating tariffs and export controls.
Broader Implications and Expert Perspectives
Partial Rollback of Trade War
Experts see the deal as a partial rollback of the intense tariff regime that marked the previous U.S.-China trade conflict. While tariffs remain high, the reduction signals a potential thaw in economic relations.
Strategic Importance of Rare Earths
Securing rare earth supplies is a strategic priority for the U.S., reducing dependence on China and bolstering critical industries. The upfront supply clause is viewed as a significant concession by Beijing.
Education and People-to-People Ties
Allowing Chinese students continued access to U.S. colleges reflects broader diplomatic goodwill and recognition of educational and cultural exchanges’ importance.
Next Steps and Outlook
Pending Approvals
The deal requires final approval from both President Trump and President Xi Jinping before becoming effective. The timeline for ratification remains uncertain.
Market and Policy Watch
Investors and policymakers will closely monitor the implementation of tariff adjustments, rare earth shipments, and any further negotiations. The deal’s success depends on sustained cooperation and enforcement.
The announcement of a “done” US-China trade deal by Donald Trump marks a potentially pivotal moment in one of the world’s most consequential economic relationships. While Asia-Pacific markets reacted with caution and mixed results, the deal’s provisions—especially on tariffs and rare earth supplies—could reshape trade dynamics and industrial competitiveness. As both nations move toward formalizing the agreement, stakeholders remain vigilant about its real-world impact amid lingering geopolitical complexities.