US-China Trade Deal Done: Commerce Secretary Lutnick Says 'They're Going To Deliver Rare Earths To Us'

In a major breakthrough, the U.S. and China have signed a trade deal following up on the negotiations they had in London earlier this month.

This was confirmed by Commerce Secretary Howard Lutnick in an interview with Bloomberg on Thursday. He  said, "We had a trip to Geneva, and then that was being slow-played. We got back together in London, and that deal was signed and sealed two days ago.”

This deal included a commitment from China to deliver rare earths used in a host of items, ranging from wind turbines to jet planes.

“They’re going to deliver rare earths to us,” and once they do that, “we’ll take down our countermeasures.”

The Commerce Secretary reupped President Donald Trump’s comments earlier at the White House regarding signing the China trade deal a day ago and getting very close to the finish line with India. 

“Of course, the way these deals happen is [that] their prime minister and their parliament have to approve it,” he said.

The tariff issue has remained an overhang for the market that has resiliently pushed ahead despite the uncertainty on that front and the geopolitical tensions

The Invesco QQQ Trust (QQQ) ETF and the SPDR S&P 500 ETF (SPY) have gained over 5% and 7%, respectively, so far this year. Both ETFs were trending on Stocktwits as users debated whether the trade deal would hold up.

A Reuters report, citing a White House official, said China and the U.S. have “agreed to an additional understanding for a framework to implement the Geneva agreement,” adding that the understanding is about “how we can implement expediting rare earths shipments to the U.S. again.”

Lutnick also said the U.S. president would make calls and finalize the details of the deals. He added that the Trump administration would then “lay out a structure of all the different kinds of tariff arrangements with different countries.”

“We're going to set that all up and get that ready for July 9.

After Trump announced sweeping tariffs on its trading partners in early April, he paused the implementation, barring the baseline 10% levy, for 90 days to allow scope for bilateral negotiations. 

So far, the U.S. has clinched a deal with the U.K. alone. 

Delving into how the deals will play out, Lutnick said, “Basically, the deals we're going to announce are that are sort of the head of the class — the structural spot in the line, and then all the other countries will fit behind those categories.”

The Trump official said, “So we're going to do top ten deals, put them in the right category, and then these other countries will fit behind.”

He also suggested that the tariff rates will be set by July 9, although the holdouts can still come and negotiate further. 

Lutnick lauded the European Union (EU) for doing an excellent job in tariff negotiations and expressed optimism that a deal would be reached, although at the very end.

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