The US said that China will purchase a "very substantial" amount of US products to ease the trade imbalance, and would clamp down on the export of deadly synthetic opioid fentanyl to the US.
Markets, however, pulled back sharply after Monday's rally as doubts crept in over what could realistically get accomplished in the tight negotiating window. "Bob Lighthizer will be working closely with Steve Mnuchin, Larry Kudlow, Wilbur Ross and Peter Navarro on seeing whether or not a REAL deal with China is actually possible".
Already there was confusion over when the 90-day period would start.
Trump, in a series of Twitter posts, threatened to slap a range of import penalties on Chinese products if they did not make major changes in their economic relationship with the United States.
"When people or countries come in to raid the great wealth of our Nation, I want them to pay for the privilege of doing so", he said. The pair negotiated a pause in the trade scandal, fuelled by the Trump administration, thereby buying time for coming up with a more comprehensive agreement that would more permanently improve the bilateral relations.
Washington and Beijing said they will try to achieve a permanent deal within the next 90 days, however the US still has significant leverage, stating that if a formal deal can't be reached then it will hike tariffs from 10 percent to 25 percent, which could roil global stock markets, stagnate global economic growth, dampen oil demand growth and possibly lead to a recession across the globe, particularly in emerging economies. "Unless extended, they will end 90 days from the date of our wonderful and very warm dinner with President Xi in Argentina", Trump said.
China's national currency has shot upwards more dramatically over the past two days than over the last decade after the country reached a truce in its trade war with the United States, and in light of a temporary decline in the dollar prices.
While Trump hailed the agreement with Xi "an incredible deal", a lack of detail from the Chinese side has left investors and analysts wondering if Trump's exuberance is warranted.
He said for the first time there was "a clear path" to reduce the U.S. trade deficit with China to zero.
His appointment of Lighthizer to lead the talks instead of Mnuchin puts one of the administration's toughest China critics in charge.
China's ambassador to the United States brushed off questions about the different accounts of the Trump-Xi meeting.
Trump's disparate statements about his commitment to brokering a lasting deal with China were the result of him trying to both appease the stock markets and gain leverage in the negotiations with China at the same time, Guajardo said.