China hailed a trade agreement with the U.S. that will see both sides sharply reduce their tariffs for 90 days, calling it an "important step" that could lead to "deepening cooperation" between the world's two largest economies.

The Trump administration says it intends to develop a 'mechanism' that will 'rebalance' the U.S. trade relationship with China — a task that has eluded presidents for decades.

The May 12 announcement is best viewed as a truce that does not shift the underlying structural reality: the U.S. and China are locked into a long-term cycle of escalating strategic competition.