In the weeks leading up to the high-profile summit between President Donald Trump and Chinese leader Xi Jinping, American businesses significantly increased their orders for Chinese goods, according to a private survey by China Beige Book. The survey, which included 1,296 Chinese companies between September 1-22, found that the gauge measuring U.S. orders jumped to 13 in September, up from negative-12 a year earlier and 3 in August, marking a 'surprise' increase as China's relative tariff position improved [1]. Despite this upswing in U.S.-bound orders, overall Chinese domestic and export orders remained below their levels from a year earlier, and new orders weakened from August, indicating that the broader export recovery is still fragile [1].
The increase in U.S. orders coincided with the extension of a trade truce between the two countries by two months to January. This extension keeps tariffs lower, suspends restrictive controls on rare earth exports, and holds off higher port fees on ships [1]. Additionally, the U.S. reportedly planned to delay a threatened round of tariffs related to industrial overcapacity until at least after the summit, providing near-term relief for Chinese exporters [1]. Despite these measures, the effective U.S. tariff rate on Chinese goods remains around 23%, which is significantly higher than the average levy imposed on other major trading partners, according to Barclays [1].
Official data also showed that China's ports experienced their busiest week on record in the run-up to the summit, further supporting the notion that trade flows are recovering amid hopes for a thaw in bilateral relations [1]. Following the truce extension, Eurasia Group raised its odds of continued stability in the U.S.-China relationship to the highest level since Trump returned to office, and noted that the shorter-than-expected extension is unlikely to reignite tensions [1]. Dan Wang, China director at Eurasia Group, stated that 'neither government has an interest in renewed escalation' and expects both sides to seek near-term commitments to maintain the fragile stability [1].
Looking ahead, Washington is likely to push for expedited Chinese approval of rare-earth export licenses for U.S. end users and increased purchases of U.S. agricultural goods, while Beijing is expected to seek a continued pause on U.S. arms sales to Taiwan [1]. The two leaders are also expected to meet again at the APEC summit in Shenzhen in November, and potentially on the sidelines of the G20 summit [1].
CONCLUSION
The surge in U.S. orders for Chinese goods and the extension of the trade truce signal a temporary easing of trade tensions between the world's two largest economies. While the overall export recovery remains tentative, the market is responding positively to the prospect of continued stability and further high-level negotiations.