China is reportedly considering a easing of its steep 125% tariffs on certain U.S. imports, including medical equipment, ethane, and aircraft leasing, according to Bloomberg. The move comes as some domestic industries feel the pinch from the prolonged trade dispute with the U.S.
Citing unnamed sources, the report highlights that Chinese authorities are discussing targeted relief measures to reduce pressure on sectors hit hardest by retaliatory tariffs. For instance, many Chinese airlines lease their aircraft from foreign firms, and the added tariff could make those deals unaffordable.
This potential rollback mirrors recent U.S. steps to soften its stance, such as removing some electronics from its own 145% tariff list on Chinese goods. Both sides appear to be signaling limited concessions as economic interdependence continues to disrupt critical industries.
China Pumps 600 Billion Yuan Into Banking System Amid Tariff Pressures
To support its economy against the impact of U.S. tariffs and upcoming government bond sales, the People’s Bank of China (PBOC) has injected 600 billion yuan into the banking system through its one-year Medium-Term Lending Facility (MLF). After accounting for maturing loans, this results in a net cash addition of 500 billion yuan — the largest since December 2023.
This unexpected move comes as investors pushed for more supportive policies, with 1.7 trillion yuan worth of reverse repos set to mature this month. The central bank aims to ease liquidity stress without cutting the reserve requirement ratio for banks, while also shifting focus to short-term interest rates and adjusting how loans are priced.