For months, American shoppers have braced for impact as tariffs between the U.S. and China soared, raising prices across everything from toys to tools. But that could be changing.
In a surprise turn, both countries just agreed to slash tariffs for 90 days. U.S. duties will drop from 145% to 30%, while China cuts theirs from 125% to 10%. Markets rallied instantly. But what does this mean for everyday buyers? While relief is possible, the economic effects—and price drops—aren’t guaranteed.
Here’s a closer look at how this temporary deal could reshape your receipts, shopping habits, and expectations.
How the Tariff War Escalated So Quickly
The current tariff storm began in early 2025 when President Trump reignited trade tensions with a series of aggressive tariff hikes. April’s 34% “reciprocal” tariffs on Chinese goods triggered a tit-for-tat response, with rates eventually breaching triple digits.
Nearly $600 billion in U.S.-China trade was disrupted. China slapped duties of up to 125% on American imports. The ripple effects hit hard: supply chains snapped, prices soared, and consumer confidence plunged. The result? A retail rollercoaster that left both businesses and shoppers struggling to adjust.
What’s in the Geneva Deal—and What’s Not
Behind closed doors in Geneva, Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng reached a 90-day tariff truce. Trump hailed it as a “total reset.” The U.S. will slash tariffs to 30%, and China to 10%.
More importantly, both sides committed to ongoing economic dialogue with rotating host nations. Still, this is just a pause. Issues like market access and intellectual property remain unresolved. The clock is ticking—and what happens next will determine whether this is progress or just another temporary patch.
Wall Street Cheers, but Retailers Remain Cautious
Wall Street cheered the announcement, with Dow, S&P 500, and Nasdaq futures all climbing overnight. Asian markets rallied too. Investors see a cooling trade war as a win for supply chains and a signal that a global recession might be avoided.
But behind the scenes, retailers face tough calls. Do they slash prices now, or wait for clarity? For many, it’s a logistical headache. With margins already strained, businesses are recalculating fast—but they’re not rushing into discounts just yet.
Online Retailers Were First to Feel the Pain
Online retailers bore the brunt of the tariff spike. TikTok Shop saw its U.S. sales collapse—from $290.8 million in March to $197.4 million following the tariff hike. Sellers like cosmetics merchant Qian Liu simply exited the market: “If we pay tariffs accordingly, we won’t make any profit.”
The removal of the $800 “de minimis” rule, which once let low-value imports avoid duty, worsened the blow. E-commerce platforms were left absorbing costs—or passing them on. Now, the question is whether this reprieve comes soon enough to undo the damage.
Price Spikes Hit More Than Just Tech
From power tools to baby strollers, tariff fallout reached deep into American households. Stanley Black & Decker bumped tool prices and considered more hikes. Adidas warned U.S. customers to expect higher costs. Even basics weren’t spared—Procter & Gamble hinted at rising prices for staples like Bounty and Tide. For many, the wallet squeeze was undeniable.
While the Geneva agreement offers relief, analysts say not all hikes will vanish. Some are baked into long-term contracts and supply costs. So yes, prices may fall—but don’t expect a full rollback on every shelf anytime soon.
Stockpiling Becomes the New Normal
In response to surging costs and tariff uncertainty, shoppers took matters into their own hands. Some loaded up like it was 2020 again. “I’m purchasing double of everything—beans, canned items, flour, you name it,” said Thomas Jennings, 53, while shopping at Walmart. Others zeroed in on specific goods like olive oil and hygiene products.
One Temu customer saw $92 in import fees tacked onto an $83 order. With inflation fears rising, consumer sentiment slumped for four straight months. The Tax Foundation projected tariffs would cost families an extra $2,100 annually—fueling a return to cautious, preemptive buying behavior.
Will Prices Drop During the 90-Day Window?
It’s the question every shopper’s asking—and the answer is complicated. While tariff cuts should ease pressure, retailers are unlikely to slash prices overnight. Many had already raised prices to offset past costs and want assurance the deal will stick before reversing course.
Commerce Secretary Howard Lutnick emphasized that a 10% baseline tariff is still in place, hinting at long-term cost adjustments. And with back-to-school season approaching, retailers may use this period to test price elasticity. So while a few deals could emerge, the broader picture may stay murky until at least the holidays.
It’s More Than Shopping—It’s the Whole Economy
Tariffs haven’t just hit checkout lines—they’ve strained entire economies. While the New York Fed’s supply chain pressure index sat at -0.29 in April, signaling low strain, inflation fears loomed large. The U.S. trade deficit soared in March as firms rushed to import ahead of tariffs.
Consumer inflation expectations hit their highest mark since 1981. Economists warned that prolonged high tariffs could tip the U.S. into recession, fueling both inflation and job losses. The Geneva agreement isn’t just a shopper’s win—it’s a necessary course correction to prevent a broader economic backslide.
What Shoppers Can Do as Talks Continue
This 90-day window is a reprieve—not a resolution. Shoppers should stay sharp. Don’t rush purchases based on headline hype; many prices won’t drop immediately. For big-ticket items like electronics and furniture, consider timing buys while tariffs are low. Monitor retailers who may overstock during the lull, potentially triggering clearance sales.
And stay updated—August marks the deal’s deadline. If talks stall, higher costs could return. Set alerts, plan early, and stay flexible. Whether this truce holds or fizzles, one thing is clear: in today’s economy, informed shopping isn’t just smart—it’s survival.
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