US President Donald Trump and Chinese President Xi Jinping held a lengthy phone call on Thursday, reaffirming a tenuous trade agreement and pledging further dialogue amid renewed tensions over critical minerals and technology restrictions.
The call, initiated by Trump and confirmed by China’s state media, lasted around 90 minutes and focused primarily on trade, according to a post by Trump on Truth Social. He described the exchange as a “very good” conversation that resulted in a “very positive conclusion for both countries,” specifically citing rare earth exports as a key issue addressed.
The call follows a temporary agreement reached on May 12 to reduce tariffs for 90 days, an attempt to stabilise markets after months of economic friction. Under the deal, the US lowered tariffs on Chinese goods from 145% to 30%, while China cut duties on US imports from 125% to 10%. However, that truce remains delicate.
While the conversation focused on economic matters, Trump said no topics outside trade—such as Ukraine or Iran—were discussed. Xi, according to Trump, extended an invitation for the former president and First Lady to visit China, which Trump reciprocated.
The timing of the call is significant. It follows weeks of uncertainty, during which tensions escalated over accusations from Washington that China is restricting the export of critical minerals—materials vital to manufacturing sectors including electric vehicles, semiconductors, and defence. In April, China suspended exports of a wide range of such minerals and industrial magnets. The move has disrupted global supply chains and is seen by Beijing as a form of strategic leverage.
At the same time, Beijing has voiced opposition to US restrictions on advanced chip technology and tightened student visa policies. These disputes are unfolding alongside long-standing disagreements over issues such as Taiwan and the illegal trafficking of synthetic opioids like fentanyl.
Trump has repeatedly advocated for a direct call or meeting with Xi, viewing leader-to-leader engagement as key to resolving deadlocks. Traditionally, China has preferred to resolve issues at lower diplomatic levels before top-level talks are held.
Since returning to office in January, Trump has taken an unpredictable stance on trade, threatening a series of measures only to backtrack later. This has unsettled global markets and left businesses uncertain about how to plan for upcoming quarters. The tariffs are also being contested in ongoing US court cases.
While the recent agreement offered a brief respite and initially boosted market sentiment, Trump has since accused China of breaching the deal and imposed new curbs on chip design software exports. China has denied any violations and warned of countermeasures.
The timing of the latest conversation is critical, with investors closely monitoring the situation for potential disruptions to supply chains ahead of the holiday shopping season. The unresolved trade issues between Washington and Beijing continue to present risks to corporate earnings and broader global economic stability.
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