China blinks first, quietly drops tariffs on some US products: Report

President Donald Trump chalked up a victory in the trade war against China after the communist government quietly dropped the tariffs on some products, according to a report.

Trump backed off from many of the reciprocal tariffs he had issued after a stock market crash, but he kept the massive tariff against China after it retaliated with its own tariffs. Retailers are reporting many economic repercussions from the curtailing of imports from one of the largest trading partners to the U.S.

'Maybe the children will have two dolls instead of 30 dolls, and maybe the two dolls will cost a couple of bucks more.'

According to a Reuters report, China has exempted some products from its 125% tariff and is reaching out to U.S. companies to let them know about the trade capitulation. The report cited sources who wanted to remain anonymous about the "whitelist" of tariff-exempt products.

The covert policy allows China to continue its defiant tone in public while trying to ease the pain of the trade war behind the scenes.

Critics of Trump's trade war point to a recent report indicating that the gross domestic product from the U.S. shrunk in the first quarter of 2025 for the first time in three years. The president blamed the policies of former President Joe Biden for the news in that report.

Ocean container bookings from China to the U.S. dropped by 60% after Trump announced the tariffs in April and have not recovered, according to Flexport, a shipping company based in San Francisco.

Trump has indicated that he's willing to reduce the tariffs on China but will not drop them completely.

"We’ve been ripped off by every country in the world, but China, I would say, is the leading ... candidate for the 'chief ripper-offer,'" Trump said at a Cabinet meeting Wednesday.

He also downplayed any possible negative effect on product availability because of the tariff tiff.

“Somebody said, ‘Oh, the shelves are gonna be empty.’ Well, maybe the children will have two dolls instead of 30 dolls, and maybe the two dolls will cost a couple of bucks more,” he added.

Flexport CEO Ryan Petersen told PBS that he expects product shortages will lead to job losses in the months ahead if there's no further de-escalation in the trade war.

“It’s going to be much more about the layoffs that follow,” Petersen said. “That’s where the real pain is going to be felt. Shortages mean companies aren’t selling stuff and therefore don’t have the profits that they need to pay their workers.’’

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