Donald Trump hosts Xi Jinping in Washington from Thursday for a three-day state visit that markets hope will extend the US-China trade truce before it expires in November.
Xi will be greeted personally by Trump at Andrews Air Force Base ahead of a White House state dinner and a military flyover, the BBC reported. The trip marks Xi's first state visit to the US since 2015 and his third meeting with Trump in the past year, with tariffs, rare earths, AI controls and Taiwan all on the agenda.
Related reading: Bursa closes lower as oil slides; oil falls below $100 as US-Iran talks ease supply fears.
What Is on the Table
- Trade: whether the tariff truce is extended, and whether more non-strategic goods get duty cuts
- Rare earths: whether China gives greater supply certainty without the US trading away tech controls
- AI: whether both sides open practical channels on AI risks while rivalry continues
- Taiwan: the standing flashpoint behind every US-China summit
The Truce Clock Is Ticking
The truce struck in October 2025, when both leaders met in South Korea, saw Washington suspend steep tariff hikes while Beijing stepped back from restricting rare earth exports. Many observers expect a one-year extension, ThePrint reported, though the US may push a shorter window to press for more concessions.
Pressure is building on both sides. America's goods deficit with China tops $91 billion, Census data shows, while Chinese rare earth exports to the US have fallen despite the October deal. Trade talks on the UN General Assembly sidelines on Tuesday made no meaningful progress, BBC sources said, with negotiators still working through non-tariff issues and farm exports on Wednesday.
Trump has kept the tone friendly. A delayed report on Chinese excess capacity stays on hold until after the summit, and Washington may suspend many China tariffs while keeping a 7.5% duty in place, ThePrint reported.
Markets Are Priced for Calm
Stocks have climbed into the summit. The S&P 500 rose about 1% with the Nasdaq 100 up 2.2% as oil slipped under $100 and Hormuz traffic hit a six-month high, easing supply fears, Briefs and US Central Command data showed.
Oil adds a second tailwind. Trump has signalled openness to meeting Iranian President Masoud Pezeshkian, and Brent has fallen for five straight sessions toward $99 as traders price diplomacy over disruption.
Why This Matters for Asia
Any shift in tariffs or rare earth flows runs straight through Asian supply chains, from electronics and EVs to chip packaging, where Malaysia plays an outsized role. A longer truce steadies tech trade and tourism flows that Bank Negara counts among its growth supports this year.
What to Watch Next
- The joint statement: any truce extension, its length, and tariff language
- Rare earth flows: volumes matter more than communique wording
- AI and Taiwan lines: new dialogue channels would signal stabilisation
- Friday markets: equities, oil and the dollar will grade the outcome fast