Washington delays semiconductor tariffs as it seeks China trade truce

The U.S. has decided to delay the imposition of tariffs on Chinese semiconductor imports until June 2027. This decision, based on a year-long Section 301 investigation initiated under the Biden administration, found China's industrial policies to impose unreasonable burdens on U.S. commerce as they aim for dominance in the global semiconductor market. The tariff delay signals a strategic effort to stabilize trade relations with China while keeping the option of tougher actions on the table. The tariffs will apply to older-generation chips, with the specific rate to be announced at least 30 days before implementation. This preserves flexibility for future administrations while easing near-term trade tensions. In response, China has expressed opposition but the focus for the U.S. is on maintaining sector stability and moving forward with negotiations. Notably, U.S. technology firms, especially companies like Nvidia, should benefit from these developments, as the removal of immediate policy obstacles may allow for clearer demand and inventory planning moving forward. However, the underlying risks remain, with ongoing uncertainty potentially affecting valuations beyond 2026.