US and China are holding trade talks in London after Trump's phone call with Xi

High-level delegations from the United States and China met in London on Monday to try and shore up a fragile truce in a trade dispute that has roiled the global economy.

A Chinese delegation led by Vice Premier He Lifeng held talks with US Commerce Secretary Howard Lutnick, Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer at Lancaster House, an ornate 200-year-old mansion near Buckingham Palace.

Wang Wentao, China's commerce minister, also was part of Beijing's delegation.


The talks, which may continue on Tuesday, follow negotiations in Geneva last month that brought a temporary respite in the trade war.

The two countries announced on May 12 they had agreed to a 90-day suspension of most of the 100 per cent-plus tariffs they had imposed on each other in an escalating trade war that had sparked fears of recession.

The US and China are the world's biggest and second-biggest economies. Chinese trade data shows that exports to the United States fell 35 per cent in May from a year earlier.

Since the Geneva talks, the US and China have exchanged angry words over advanced semiconductors that power artificial intelligence, visas for Chinese students at American universities and "rare earth" minerals that are vital to car makers and other industries.

President Donald Trump spoke at length with Chinese leader Xi Jinping by phone last Thursday in an attempt to put relations back on track. Trump announced on social media the following day that the trade talks would resume in London.

Rare earths were expected to be a focus of the talks. The Chinese government started requiring producers to obtain a licence to export seven rare earth elements in April. Resulting shortages sent automakers worldwide into a tizzy. As stockpiles ran down, some worried they would have to halt production.

Beijing indicated Saturday that it is addressing the concerns, which have come from European companies as well as US firms.

Kevin Hassett, a US economic adviser, told CNBC on Monday that he expected a short meeting with "a big, strong handshake" on rare earths.

The UK government says it is providing the venue and logistics but is not involved in the talks, though British Treasury chief Rachel Reeves met with both Bessent and He on Sunday, and UK Business Secretary Jonathan Reynolds was due to meet Wang.

"We are a nation that champions free trade and have always been clear that a trade war is in nobody's interests, so we welcome these talks," the British government said in a statement.