US trade discussions with China have stalled, according to Treasury Secretary Scott Bessent.

He said on May 28, 2025, that further progress may require direct involvement from US President Donald Trump and Chinese President Xi Jinping.

Bessent told Fox News that while a temporary truce in the trade war was reached two weeks ago, progress has since been limited.

He indicated that additional talks are anticipated in the coming weeks and suggested a possible call between the two leaders to advance negotiations.

“This is going to require both leaders to weigh in with each other,” he said.

🔗 Source: Reuters

🧠 Food for thought

1️⃣ Court battle reveals constitutional tension in U.S. trade policy

The legal whiplash over Trump’s tariffs, ruled unlawful one day and reinstated the next, highlights the constitutional tensions underlying U.S. trade policy.

The Court of International Trade’s ruling specifically determined that Trump overstepped presidential authority by using the International Emergency Economic Powers Act (IEEPA) to impose tariffs, affirming that regulating commerce is Congress’s exclusive power 1.

This reflects historical struggles between executive and legislative branches over trade authority, with presidents increasingly using national security justifications to implement tariffs without congressional approval since 2018 2.

The quick reinstatement by the appeals court maintaining these tariffs while litigation continues creates significant uncertainty for businesses, as they face an average household purchasing power reduction of $950 if the tariffs remain in place 3.

The legal battle could potentially reach the Supreme Court, setting precedents about presidential trade powers that would impact economic policy for decades to come.

2️⃣ US-China trade relationship shows diminishing returns from tariff strategies

Despite years of escalating tariffs on Chinese goods, the fundamental trade issues between the U.S. and China remain largely unresolved.

The U.S. trade deficit with China still stands at $295 billion as of 2024—the lowest since 2009 but still the largest deficit with any trading partner—suggesting limited effectiveness of tariff policies in addressing structural imbalances 4.