Washington, DC [US], August 15 (ANI): The United States and China have agreed to extend their tariff truce for 90 days, CNN reported, citing an executive order signed by President Donald Trump.

This move averts an immediate surge in duties that could have severely impacted trade between the world's two largest economies.

Notably, the tariffs on Chinese goods would have skyrocketed to 54 per cent from 30 per cent, while Chinese tariffs on US exports would have jumped to 34 per cent from 10 per cent.

In a joint statement with the US, China confirmed the 90-day trade truce extension and said it would maintain the 10 per cent tariffs it has imposed on American goods during that period.

The Joint statement follows bilateral negotiations held in Sweden last month, it said.

The extension comes after Trump imposed a slew of 'reciprocal' tariffs on trading partners around the world, which have raised the United States' effective tariff rate to levels not seen since the Great Depression, as per CNN.

According to CNN, higher tariffs on Chinese goods, America's second-largest source of imports, would have almost certainly raised the costs many American businesses and consumers could pay -- or already are paying -- because of increased import taxes Trump has enacted.

After meeting in Sweden in July, Chinese negotiators went as far as to say that a deal was reached. Treasury Secretary Scott Bessent and US Trade Representative Jamieson Greer, both of whom attended the meeting, disputed that, saying nothing was final without Trump's word.

'We'll see what happens. They've been dealing quite nicely. The relationship is very good with President Xi and myself,' Trump had said on Monday.

A White House fact sheet on the extension said trade discussions with China have been 'constructive' and quoted Trump saying: 'We're getting along with China very well.'

At the conclusion of last month's meeting with Chinese trade officials, Bessent said he warned his Chinese counterparts that continuing to purchase Russian oil would bring about huge tariffs under legislation in Congress that allows Trump to impose levies up to 500 per cent. (ANI)