Bessent says he expects ‘de-escalation’ in U.S.-China tariff fight in the ‘very near future’

Treasury Secretary Scott Bessent told investors in a closed-door meeting Tuesday he expects "there will be a de-escalation" in President Donald Trump's trade war with China in the "very near future," a person in the room told CNBC.

"The next steps with China are, no one thinks the current status quo is sustainable" with tariff rates at their current levels, Bessent said at a private investor summit in Washington, D.C., hosted by JPMorgan Chase.

Stocks, already recovering from the prior day's sell off, soared higher after Bessent's remarks were first reported.

Bessent said he believes that the prospect of de-escalation between the economic superpowers "should give the world, the markets, a sigh of relief," according to the person in the room.

Bessent also insisted that, despite the U.S. ratcheting up tariffs on Chinese imports to 145% and China retaliating with 125% duties on American goods, the goal of Trump's policy "isn't to decouple."

The U.S. Cabinet secretary noted that negotiating with China is likely to be "a slog." But neither side "thinks the status quo is sustainable," Bessent added.