President Donald Trump and Chinese President Xi Jinping spoke by phone on Thursday, breaking a months-long silence as trade tensions between the United States and China show signs of intensifying.
The call, confirmed by Chinese state media but not immediately acknowledged by the White House, comes at a critical juncture in the two countries’ strained economic relationship.
The long-anticipated conversation was initiated by Trump, according to China’s Ministry of Foreign Affairs. It was only the second direct exchange between the leaders this year, following a call in January shortly before Trump’s inauguration for his second term.
Though details of the call were not immediately released, the context surrounding the conversation reflects the fragile state of trade relations between the world’s two largest economies. Despite a temporary truce reached during talks in Geneva last month, where both sides agreed to lower tariffs for 90 days, that pause now appears tenuous. Washington has accused Beijing of not following through on commitments, particularly around easing restrictions on the export of rare earth minerals crucial to US manufacturing.
Meanwhile, China has expressed dissatisfaction over new US measures, including tighter visa restrictions for Chinese students and export limits on certain advanced technologies. Beijing maintains that its rare earth policies apply globally and are not targeted at the US specifically.
The reemergence of friction comes as President Trump pursues an aggressive trade agenda. In April, his administration raised tariffs on Chinese imports to as high as 145%, while lowering duties on imports from most other countries to 10%. China responded by raising its own tariffs on US goods to 125%, effectively bringing bilateral trade to a near standstill.
The lack of communication between the leaders in recent months has been notable. Chinese officials had reportedly delayed scheduling a call with Trump, wary of unpredictable behavior that could lead to public embarrassment, as seen in prior conversations Trump had with other world leaders. Nevertheless, Trump has consistently emphasized his desire to speak with Xi directly, calling the Chinese president “VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH” in a recent social media post.
Markets initially reacted positively to news of the call, with hopes it might restart substantive negotiations. However, investor optimism faded as no immediate breakthroughs were reported.
Trade between the US and China remains a key pillar of the global economy, totaling nearly $600 billion in 2024. Yet repeated cycles of escalation and de-escalation have created uncertainty for businesses, especially those reliant on cross-border supply chains and critical imports like semiconductors and industrial materials.
While both sides have signaled a willingness to continue discussions, the path forward is unclear. Analysts suggest that Beijing is hesitant to give up leverage without meaningful progress, while the Trump administration continues to tie trade objectives closely to national security and domestic economic priorities.
With input from CNN, CNBC, and the New York Times.
