The global trade tensions sparked by US President Donald Trump’s sweeping tariff measures could end with a potential deal with China as investors are concerned about escalation from both sides.
Trump’s April 2nd announcement of mutual import duties sent shockwaves through global stocks and crypto markets. The measure includes a 10% baseline duties on all imported goods imported on April 5th by April 5th. This is expected to begin on April 9th, including a 34% tariff on Chinese imports.
However, according to Raoul Pal, founder and CEO of Global Macro Investor, tariff negotiations could only be a “stance” to reach an agreement with China.
“In the end, almost all of the other tariff negotiations and rhetoric is to make China agree to the deal,” Pal wrote in the X-Post on April 8th.
“It’s a big prize, and both China and the US understand it and need it. Everything else is a negotiation attitude. China needs a weaker $, and the US needs tariffs.”
Source: Raoul Pal
“The US is also trying to use other channels such as Mexico and Vietnam to close China’s tariff arbitrage law,” Pal said.
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China will retaliate with new tariffs
Given China’s latest retaliatory measures, the resolution remains unlikely in the short term.
In response to US tariffs, China imposed a 34% tariff on all US imports on April 10, media outlet Xinhua News reported on April 4. China’s Foreign Ministry vows to “fight to the end” against Trump’s tariffs, known as “bullying” by the global economy.
China is overtaking the US in global trade. Source: Econovis
China overtook the US in 2012, becoming the world’s largest trading nation due to its total exports and imports, surpassing its $4 trillion in commodity trade that year, according to the Guardian.
Crypto Markets closely monitors the outcome of trade
As trade disputes continue to evolve, analysts say the potential agreement between the two global superpowers could serve as a key catalyst for recovery in the digital asset market.
Crypto Markets will be at the bottom by June 2025 with a 70% chance of recovery, Nansen analysts predicted.
Related: The bottom of the crypto market by June despite tariff horror
According to Nansen research analyst Nikolai Sondergaard, investors’ desire for risky assets such as Bitcoin depends on global tariff responses from other countries.
“We’ve reached the bottom of our local area in terms of tariffs and prices,” the analyst said on Cointelegraph’s ChainReaction Live Show at X.
“Trump came out burning his guns, but we’ve seen the worst from the US side, so we’ll see if other countries are willing to drop some tariffs.
https://www.youtube.com/watch? v = gnunx0qw3q
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