U.S. and China roll back steep tariffs as they try to reach a larger deal

Amna Nawaz:

There's been a big breakthrough in the battle over tariffs. The United States and China have paused many of their most punishing tariffs for the time being while they try to reach a larger deal.

Geoff Bennett:

It's a major thaw in the trade war between the world's two biggest economies. And the news brought euphoria to the stock market. The Dow Jones industrial average skyrocketed by more than 1,100 points. The Nasdaq shot up by more than 4 percent, and the S&P 500 rose by more than 3 percent.

All of this set the stage for a big day of news from President Trump, as he began the first major foreign trip of his second term.

Lisa Desjardins starts our coverage.

Lisa Desjardins:

The closing bell rang with good news today on the New York Stock Exchange, as the U.S. and China are lowering the temperature on tariffs, at least for now, announcing a three-month pause in their trade war, buying time to reach a broader deal.

President Trump today called it a total reset.

Donald Trump, President of the United States: The relationship is very good. We're not looking to hurt China. China was being hurt very badly.

Lisa Desjardins:

In fact, the tariffs have hurt both countries, contributing to a record U.S. trade deficit and market turmoil. Now come temporary tariff reductions that are deeper than investors predicted.

The U.S. will deflate Trump's recent 145 percent tariffs on Chinese goods to 30 percent, while China will go from 125 percent on American products to 10 percent. After weekend high-stakes talks with the Chinese in Switzerland, Treasury Secretary Scott Bessent said both nations want a strong relationship.

Scott Bessent, U.S. Treasury Secretary:

The consensus from both delegations this weekend is neither side wants a decoupling. We do want trade. We want more balanced trade. And I think that both sides are committed to achieving that.

Lisa Desjardins:

In a separate press conference, Chinese officials stressed their national interests.

Li Chenggang, Trade Representative, Chinese Ministry of Commerce (through interpreter): China has always pursued win-win outcomes in its trade and economic negotiations, and therefore any deal to be reached must surely be in China's own development interests.

Lisa Desjardins:

A final deal with China is not guaranteed, and today's rollback does not include continued tariffs on cars, steel, aluminum, or pharmaceuticals.

On drug costs, today Trump signed an ambitious executive order directing that Americans will pay the lowest price available worldwide on prescription drugs. His plan is for HHS Secretary Robert F. Kennedy Jr. to give pricing targets to drug companies in the next month and then impose new regulations if they don't comply.

Donald Trump:

We're going to equalize. We're all going to pay the same. We're going to pay what Europe's going to pay.

Lisa Desjardins:

Lowering drug costs is popular, but this idea has raised opposition from drugmakers, who say it's dangerous, along with criticism from the right that this is government price control, and from Democrats who say it's meaningless, that Trump does not have this power and will be challenged in court.

All this as President Trump begins the first major foreign trip of this term, to the Middle East, stopping in Qatar, where the president says he's ready to accept a luxury Boeing 747 as a gift from that country's ruling family to use as the new Air Force One.

Donald Trump:

I think that was a very nice gesture. Now, I could be a stupid person and say, oh, no, we don't want a free plane. We give free things out. We will take one too.

Lisa Desjardins:

But it wouldn't be without cost, needing a complete scrub for any security risks and some rebuilding to become Air Force One. And there are questions of benefit. Trump says the plane would go to his presidential library, not stay in government after he leaves office.

And critics question whether it's ethical or legal for him to accept it.

Man:

Welcome. Welcome to the United States of America.

Lisa Desjardins:

Also today, while the president departs the country, a few dozen South Africans arrived as refugees outside the nation's capital. The Afrikaners, or descendants of Dutch colonizers, were given fast-track status, even as the Trump administration has virtually shut down all other refugee admissions.

Trump adviser and billionaire Elon Musk, a native of South Africa, has raised their cause. Trump today said it wasn't about race.

Donald Trump:

I don't care who they are. I don't care about their race, their color. I don't care about their height, their weight. I don't care about anything. I just know that what's happening is terrible.

Lisa Desjardins:

All of those arriving today are white. South African officials have responded strongly, saying there is no legal or factual basis for classifying this group as refugees. But in the White House is a president who classifies global issues from tariffs to drug prices to refugees on his terms, and his alone.

For the "PBS News Hour," I'm Lisa Desjardins.