Treasury Secretary Scott Bessent told reporters the two sides had agreed on a 90 day pause on measures and that tariffs would come down by over 100 percentage points to 10%.

Relief following the tariff war de-escalation looks set to be quickly replaced by government budget tensions. Alarms are ringing loudly as the U.S. hits an historic debt metric even as the administration is seeking to extend tax cuts.

While U.S. President Donald Trump has talked of victory after reaching a weekend deal with China to reduce the sky-high tariffs levied on each others' goods, businesses in China are reacting to the temporary deal with caution.

Stocks surged in early trading Monday. The jump, which saw the Dow climb over 1,000 points, came after the U.S. and China announced a 90-day pause on major tariffs. Stocks are now close to where they were at the beginning of Trump's second administration.

China and the U.S. agreed to end their recent tariff battle temporarily and restart stalled trade between the two countries.

Small business optimism reached a post-election high of 105.1 in December, buoyed by expectations of lower taxes and less regulation with President Donald Trump in the White House and Republicans in control of Congress. But Trump’s tariffs have muddied the waters for a lot of small business owners.

Stocks and the dollar surged on Monday after the United States and China said they had agreed on a 90-day pause on tariffs and reciprocal duties would drop sharply, giving investors some confidence that a full-scale trade war may have been averted.

President Donald Trump has slashed the "de minimis " tariff on low-value packages imported from China to 54 percent, down from 120 percent, the White House confirmed in an updated executive order published late Monday.