- US and Chinese negotiators concluded trade talks in Stockholm without a concrete agreement to extend their tariff ceasefire past August 12. The decision now rests with President Trump, with a potential return to high tariffs threatening global markets.
- The US Federal Reserve, led by Chairman Jerome Powell, kept its benchmark interest rate unchanged, resisting political pressure for cuts. Powell emphasised that curbing inflation remains the priority, citing ongoing price pressures from trade measures.
- Both the unresolved tariff situation and the Fed’s cautious stance on interest rates are contributing to crypto market stagnation.
The crypto market seems to be in a gridlock as many await the result of two key issues: interest rates and tariffs, especially those regarding commerce between the US and China.
US and Chinese negotiators ended two days of trade talks in Stockholm on Tuesday with a mutual pledge to pursue an extension of their current 90‑day tariff ceasefire, which expires on August 12. Both sides characterised the meetings as “constructive”, though no concrete agreements were announced.
The decision on whether to prolong the truce now rests with President Donald Trump. Without an extension, tariffs between the two largest economies could surge back to triple‑digit levels, reigniting a trade confrontation that has already rattled global markets and supply chains.
Bloomberg reported that US Treasury Secretary Scott Bessent, speaking to reporters after the talks, stressed that discussions had gone well but stopped short of confirming a deal.
The meetings were very constructive. It’s just that we haven’t given the signoff.
Scott Bessent, US Treasury SecretaryOver recent months, the White House has secured trade agreements with the EU, Japan, Indonesia and other partners. But talks with Beijing remain the most sensitive, given China’s economic weight and control over critical rare earth supplies.
In May, both countries backed away from imposing punitive triple‑digit tariffs that would have amounted to a near‑total trade freeze.
Related: SEC Greenlights In-Kind Redemptions and Spot Crypto ETPs in Major Market Shift
Powell Leaves Interest Rates Unchanged
In similar news, the US Federal Reserve left its benchmark interest rate unchanged today, with Chair Jerome Powell signaling little urgency to cut borrowing costs despite mounting political pressure from President Donald Trump for immediate rate relief.
Powell stressed that the central bank’s priority remains curbing inflation, not accommodating the administration’s push for lower government borrowing costs or cheaper home mortgages.
The Chairman warned that price pressures linked to Trump’s trade measures and other policy shifts remain elevated, making it premature to ease the Fed’s “modestly restrictive” stance.
Speaking after the decision, Powell said policymakers are still assessing the economic impact of the White House’s tariff changes and broader fiscal moves.
You have to think of this as still quite early days. There’s quite a lot of data coming in before the next meeting. Will it be dispositive? … It is really hard to say.
Jerome Powell, Chair of the Federal Reserve of the United StatesThe Fed will have two months of additional inflation, jobs, and growth data before its next policy meeting on September 16‑17. Powell indicated those figures will be key in determining whether rate cuts can begin, but cautioned against assuming a September pivot is certain.
As many are familiar, interest rate changes can heavily affect the crypto market because they shape the flow of capital. Higher rates mean reduced risk appetite because investors turn to safer investments, while lower rates have the opposite effect.
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