Trump softens stance on China amid economic pressures and market volatility

After weeks of bruising trade battles and inflammatory rhetoric, President Donald Trump now appears to be striking a markedly softer tone on China— raising questions about what’s driving this sudden shift in strategy.

On Tuesday, 22 April 2025, the US president signalled that his administration may substantially reduce , a stunning reversal from his earlier hardline approach.

Speaking from the Oval Office, Trump told reporters, “We’re going to be very nice, they’re going to be very nice, and we’ll see what happens,” in reference to the prospect of future trade talks with Beijing. The remark was a far cry from previous statements in which he accused China of economic aggression and threatened to intensify punitive measures.

The change in tone comes at a time of mounting pressure on the US economy. Volatility in the stock market, heightened investor anxiety over inflation, and rising interest rates on US debt have combined to create a precarious economic environment.

These strains appear to be forcing a recalibration of the Trump administration’s tariff policy, particularly given that formal negotiations with Beijing have yet to commence — and China sent out a sharp message to other nations beforehand, warning them not to side with their rival, so to speak.

Treasury secretary Scott Bessent echoed this sentiment at a private investment conference hosted by JPMorgan Chase in Washington on Tuesday, 22 April, where he candidly described the current state of US–China trade relations as “unsustainable”.

Bessent forecast a likely de-escalation in the tariff war, though he admitted that any talks with China would be slow and complex.

So why the sudden charm offensive?

One reason may be that the political cost of continued economic disruption is becoming too great. Trump’s universal tariff regime, which includes a 10 per cent baseline tariff on all countries and “reciprocal” rates as high as 125 per cent on nations with large trade deficits like China, has rattled markets and drawn criticism from business leaders.

Despite exemptions on key electronics like smartphones and semiconductors, the overall strategy has added to inflationary pressure and increased the cost of consumer goods.

Another factor is optics. Trump’s willingness to say the tariffs will "come down substantially" seems designed to create the impression of control and pragmatism ahead of any potential trade breakthrough — without appearing to fully backtrack on his ‘America First’ rhetoric.

“It won’t be zero — used to be zero. We were just destroyed. China was taking us for a ride,” he insisted, signalling that any future deal would still involve some level of tariff protection.

Yet for all the positive signalling, there’s no evidence that China has returned to the negotiating table.

White House press secretary Karoline Leavitt confirmed that while more than 100 countries have expressed interest in trade talks since Trump introduced universal tariffs earlier this month — and 18 have formally submitted proposals — China is not among them.

Still, Leavitt maintained the administration is “doing very well with regard to a potential trade deal with China” and is “setting the stage” for possible engagement.

Trump’s overtures may also reflect a broader strategy: to isolate China diplomatically while opening trade doors to other nations, effectively pressuring Beijing to reconsider its stance — which is exactly what Xi Jinping’s administration seems to have anticipated.

But without direct communication between Trump and Chinese President Xi Jinping, and with Beijing yet to engage, questions remain over whether this softer posture will yield results.

In the end, Trump’s sudden niceness towards China may be less about warming ties and more about cold economic realities.

The administration appears to be betting that a moderated approach will ease market fears, improve trade prospects and allow the US to retain the upper hand in shaping the next chapter of US–China relations.

Whether that gamble pays off remains to be seen. For at least economically, China clearly retains the upper hand for now — and for the foreseeable future — unless the POTUS has a trump card up his sleeve nobody has anticipated.

Reacting to Trump’s latest remarks on potentially lowering tariffs, China’s Foreign Ministry stated that the United States could not claim to seek a trade agreement while simultaneously applying maximum pressure, a stance it deemed both inappropriate and unworkable.

According to The Economic Times, the Chinese foreign ministry emphasised that any meaningful progress would require negotiations grounded in equality and mutual benefit.

While expressing openness to renewed discussions, China reaffirmed its readiness to defend its interests, with spokesperson Guo Jiakun noting during a routine press briefing that although China does not desire conflict, it is not afraid of it and would "fight to the end" if required.

Jiakun reiterated that “the door for talks is wide open,” underscoring a willingness to re-engage, provided the approach is constructive.