US and China extend trade truce by two months as Xi visits Washington

The United States and China have agreed to extend their trade truce by two months, moving the deadline to January 10, as Chinese President Xi Jinping begins a three-day state visit to Washington. The extension gives both leaders more time to manage their economic rivalry. US Treasury Secretary Scott Bessent announced the extension, which keeps the "Busan Agreement" in place, after an unscheduled meeting with Chinese Vice-Premier He Lifeng. Bessent said some Chinese commitments, particularly on rare-earth exports, had not been fully met, and China has proposed a "bigger deal" for broader trade discussions. The truce had eased tensions after sweeping US tariffs, lowering some restrictions and securing Chinese pledges on soybeans and fentanyl precursors. Talks are expected to cover Taiwan, technology, and AI, with a further AI safety meeting planned in Shenzhen in about two months.