US-China Tariff Ceasefire Fuels US Equities and Crypto Rally Monday
US equities and cryptocurrencies surged Monday after US and Chinese officials announced an agreement to temporarily reduce tariffs during ongoing trade negotiations.
Stock Market Gains
The S&P 500 and Nasdaq Composite indexes recaptured key April 2 highs, reversing several weeks of the “Liberation Day” selloff.
Cryptocurrency Performance
Bitcoin surpassed the $105,000 threshold early Monday, its highest level since January, while Ethereum gained nearly 4.6%.
Tariff Agreement Details
Following weekend talks in Geneva, a joint statement revealed a temporary reduction: US tariffs on Chinese imports decreased from 145% to 30%, while Chinese tariffs on US goods were lowered from 125% to 10%. These rates will remain in effect for 90 days.
Decoupling Ambitions
Treasury Secretary Scott Bessent stated the US policy goal is strategic decoupling from China, clarifying this aims to avoid complete severance.
Expert Analysis
Noelle Acheson, author of the “Crypto is Macro Now” newsletter, described Monday’s developments as a “ceasefire, not a deal,” emphasizing the temporary nature of the truce and the likelihood of continued volatility until a comprehensive agreement is finalized.
Potential for Continued Volatility
Analysts caution that sentiment-driven rallies may prove fragile and could mask underlying risks.
Crypto Analyst Perspective
James Toledano, chief operating officer at Unity Wallet, expressed skepticism about the crypto rally, calling it potentially “hollow” due to its reliance on political maneuvers rather than fundamental drivers.
Toledano further noted that significant crypto price movements remain contingent on achieving regulatory clarity in the United States.
Note on Stablecoin Legislation
Separately, bipartisan support for the GENIUS Act, a stablecoin legislation, has waned, following a procedural setback in the Senate.
