Top economic officials from the United States and China are set to renew negotiations Monday -- with an extension of lower tariff levels on the cards -- as President Donald Trump's trade policy enters a critical week.

Without a new deal, American levies could return to triple-digit levels — effectively imposing what some analysts describe as a “bilateral trade embargo.”

Trump, has pushed for tougher trade rules on China and imposed a 20% tariff in March over the fentanyl crisis, accusing Beijing of not doing enough to stop the flow of the drug into the United States.

The Trump administration’s trade deal with China that sharply lowered the tariff rate on Chinese imports is expected to be extended past its Aug. 12 deadline, Treasury Secretary Scott Bessent predicted Tuesday, though he maintained higher tariff rates on other countries’ imports are still slated to take effect Aug. 1 as scheduled.

The GBP/USD pair posts modest gains near 1.3440 during the Asian trading hours on Monday. The latest optimism fueled by a trade deal between the United States and the European Union triggers a fresh wave of the global risk-on sentiment, which boosts the Pound Sterling.

The hope, and the expectation, is that when U.S. officials meet their Chinese counterparts in Stockholm to talk economics and trade next week, they will build on a recent lessening of tensions as the U.S. tries to set up a fall meeting between the countries’ leaders and lay the groundwork for another loosely defined trade pact.

Shein shoppers in the U.S. are facing steep price hikes after a key tariff exemption ended. The policy shift, part of Trump’s broader trade crackdo

China’s budget deficit climbed to a fresh record in the first half, highlighting intensified government efforts to shore up domestic demand as Donald Trump’s tariffs reduce exports to the US.

A Trump administration campaign to stop Chinese manufacturers from evading high U.S. tariffs risks clogging global trade with red tape, snarling the supply chains that electronics companies and automakers rely on to produce goods at the lowest cost,