U.S. President Donald Trump and Chinese President Xi Jinping are meeting today in Busan, South Korea, aiming to stabilize relations between the two largest economies after months of escalating trade tensions. This high-stakes meeting is taking place on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit.

Ahead of the meeting, Trump expressed optimism, stating, "I expect to be lowering [tariffs] because I believe that they're going to help us with the fentanyl situation." He indicated that he anticipates resolving several issues during their discussions. The meeting is expected to last three to four hours, with both leaders discussing key topics affecting U.S.-China relations.

The backdrop to this meeting includes Trump's recent tariff increases and China's retaliatory measures, particularly concerning rare earth exports. In recent weeks, tensions have escalated, with Trump threatening a 100% import tax on Chinese goods. However, U.S. officials have signaled that this threat may not be pursued further, while China has shown willingness to ease its export controls and purchase more American soybeans.

Chinese Foreign Ministry spokesperson Guo Chaokun stated that China is ready to work with the U.S. to achieve positive outcomes from the meeting. He emphasized the importance of high-level diplomacy in guiding bilateral relations and expressed hope for a thaw in ties.

Investors are closely watching the meeting, with expectations that a truce could sustain bullish market sentiment. The recent trade agreement, which temporarily reduced tariffs on both sides, has already boosted global markets, reflecting optimism about a potential resolution.

As the meeting unfolds, both leaders are aware that a prolonged standoff could harm their economies and the global market. The outcome of this meeting could set the tone for future U.S.-China relations and impact global economic stability.