Markets reacted positively on Tuesday amid expectations of improving trade tensions between the United States and China.

CNBC’s Eamon Javers, citing a source that attended a White House conference, reported that U.S. Treasury Secretary Scott Bessent stated that both Washington and Beijing view the current tariff structure as undesirable.

According to the unnamed source, Bessent reportedly highlightedthe high tariff levels of 125% to 145% will force a de-escalation in economic tensions in the near term.

Crypto markets in particular reacted positively, with Bitcoin (BTC) trading solidly above $90,000 Tuesday afternoon.

The source described the current U.S.- China trade tensions as akin to an “embargo” and suggested that a new round of negotiations will be necessary.

A doable ‘slog’

While Bessent reportedly called the road ahead a “slog,” both governments are not comfortable maintaining the current trade status quo.

Additional context from the source suggests that rebalancing the trade dynamics between the two nations could involve recalibrating each country’s economic priorities. The U.S. is reportedly interested in boosting manufacturing capacity, while acknowledging that China favors industrial output over consumer-driven growth.

While the path forward remains uncertain, attendees came away with the impression that the U.S. is aiming to stay engaged with China. However, it will do so under the Trump administration’s stated goal of more equitable trade conditions.

The White House and Treasury Department have not issued any public statements regarding new negotiations. However, the tone and substance of the reported remarks suggest that early groundwork for a policy change may already be underway.