China has responded cautiously to the latest round of tariffs imposed by the United States, signaling a shift from previous confrontational exchanges between the two economic powers. On Friday, the U.S. government announced new tariffs on certain Chinese goods at a rate of 12.5 percent, a significant reduction from the 145 percent tariffs threatened by President Donald Trump last year.

This latest tariff action comes amid a broader U.S. campaign targeting over 80 trading partners under claims of failing to adequately prevent forced labor, with levies ranging between 10 percent and 12.5 percent. These measures replaced a prior global 10 percent tariff that recently expired. The White House is implementing these duties under Section 301 of the Trade Act of 1974, which allows the president to impose tariffs in response to unfair trade practices.

China’s muted reaction contrasts with earlier rounds of escalating tariffs and retaliations. Despite issuing a statement condemning the U.S. tariffs as “America’s never-ending tariffs” and accusing Washington of abusing tariff measures, Chinese officials refrained from retaliatory announcements. At a Friday news briefing, a Chinese foreign ministry spokesman reiterated opposition to unilateral tariffs but declined to specify whether China would respond in kind.

Trade experts attribute this restraint partly to a tacit agreement struck between U.S. and Chinese negotiators last year, capping tariffs at approximately 20 percent. This informal truce was reportedly sealed with a handshake between President Trump and China’s top leader Xi Jinping during meetings in South Korea and Malaysia last October. Observers suggest the new tariffs remain within agreed limits to preserve this fragile détente.

Wendy Cutler, senior vice president at the Asia Society Policy Institute, noted that tariff increases beyond 7.5 percent in the upcoming rounds could jeopardize the truce and provoke retaliatory measures. Chinese officials are reportedly confident that tariff levels will not escalate substantially, in part due to assurances provided during diplomatic exchanges.

Further complicating the situation, President Trump has announced plans for Xi Jinping to visit Washington in September, underscoring ongoing high-level efforts to manage the bilateral trade relationship. While Trump has suggested limited discussions on tariffs during recent meetings in Beijing, China’s commerce ministry has stated that “in-depth” talks on tariffs have occurred and called on the U.S. to honor commitments to maintain tariff levels within agreed parameters.

Over the course of the trade war, China has employed various strategies to counterbalance U.S. tariffs, including matching levies and exerting tighter controls over exports of rare earth elements—key components in advanced technologies such as military equipment and automotive systems. Analysts like Tu Xinquan, dean of the China WTO Institute at the University of International Business and Economics in Beijing, anticipate that sharp or broad tariff escalations are unlikely for the remainder of Trump’s term, suggesting a cautious but stable period ahead for U.S.-China trade relations.