GENEVA (AP) — The United States and China agreed on Monday to lower the high taxes they recently put on goods from other countries. This aims to restart trade between the world's two biggest economies and caused global financial markets to improve.

However, stopping the trade disagreements between President Donald Trump and China did not fix the basic problems between the two countries. The agreement gives the US and China 90 days to make a more significant deal. But this break means taxes on goods are still higher than before Trump increased them last month. Businesses and investors are still worried about whether the agreement will continue.

A U.S. official, Jamieson Greer, said the U.S. agreed to lower the 145% tax Trump started last month to 30%. China also agreed to lower its tax on U.S. goods to 10% from 125%.

Greer and Treasury Secretary Scott Bessent announced the lower taxes at a news conference in Geneva.

Officials said they felt positive because both sides have planned meetings to keep talking about their trade problems. Bessent said the very high taxes on goods they put on each other last month, which made the situation worse after Trump started it, were like stopping trade completely, and neither country wants that; they want to trade.

The US is now putting a 30% tax on goods from China. This tax has two parts: a 20% tax to make China work harder to stop the drug fentanyl from coming into the US, and a standard 10% tax that the previous president, Trump, put on goods from most countries. This 30% tax is added to other taxes on China, some of which the current president, Joe Biden, has kept.

Last month, Trump increased the total tax on goods to 145%. He was angry because China was fighting back. However, he changed his decision on Monday.

China's Ministry of Commerce said the agreement was an important move towards resolving the two countries' disagreements and creates a base for future teamwork.

This project fits with what producers and consumers in both countries expect and is good for both nations and the world, the ministry said.

In a joint statement, the two countries announced that China would also stop or remove other actions it had taken since April 2 because of the US tariffs. China had put more limits on sending out rare earth materials, some of which are very important for the defense industry. It also added more American companies to lists that control exports and identify companies that are not trustworthy, making it harder for them to do business with and in China.

Markets increase as the two groups become less angry.

We still don't know the full effect of the complicated taxes and other trade rules that the US and China have put in place.

It depends a lot on whether they can find ways to solve their old disagreements during the 90-day break.

Bessent told CNBC in an interview that officials from the U.S. and China will meet again in a few weeks.

But investors were happy when trade representatives from the world's two largest economies seemed to back down.

The value of stocks rose, with the S&P 500 and Dow Jones increasing by 2.6% and 2%. The price of oil also went up by over $1.60 per barrel, and the dollar became stronger compared to the euro and the Japanese yen.

"This is a big reduction in tension," said Mark Williams, chief Asia economist at Capital Economics. But he warned "it's not certain that the 90-day agreement will lead to lasting peace."

Dani Rodrik, an economist at Harvard University, said the two countries stopped a trade war that wasn't necessary. But he also said that US taxes on Chinese goods are still high at 30% and will mostly hurt American buyers.

Rodrik wrote on Bluesky that Trump did not get anything from China after causing a lot of problems.

Craig Singleton, who works for a group that studies China, said the quick agreement showed that both countries had more economic problems than they said.

Singleton said that China's economy was in trouble. More people were losing their jobs, money was leaving the country, and exports were falling fast. He added that Trump cared about the stock market, and this deal was a success for him, even though he didn't give up his power for future discussions.

After the U.S. and China made their announcement, stock prices went up a lot.

Even though tariffs went down a bit, and because people are unsure about future tariffs, this will still make it difficult for the two countries to trade and invest with each other, said Eswar Prasad, a professor who studies trade rules at Cornell University.

However, he said it's a good sign for the world economy that US import taxes might become important trade problems, but not impossible ones.

Jay Foreman, the head of Basic Fun, a toy company from Florida that makes toys like Care Bears and Tonka trucks, said he was happy that the tax on goods from China is now 30%. But he wants it to go down to 10%.

Foreman told his team in China to send the toys they had stopped sending in April. He thought he would have to make prices twice as high, but now they will only increase by 10% to 15% in the next two business periods.

Foreman said, "They gave us a bad choice, hoping we would be happy with another bad choice."