The U.S. and China have agreed to a 90-day truce in their trade war, reducing tariffs significantly after weekend talks between top negotiators. Financial markets are responding positively, with the Dow leaping over one thousand points and the S&P 500 rallying over 3 percent. Both sides are set to lower tariffs by 115%, but economists warn the trade war is still causing damage.President Donald Trump announced the new agreement Monday, stating, "We achieved a total reset with China." The Trump administration detailed that U.S. tariffs on Chinese goods will fall from 145% to 30%, and China's tariffs on U.S. goods will drop from 125% to 10%. The deal is set to last 90 days, allowing negotiators who met in Switzerland over the weekend time to achieve a more lasting deal. Trump said, "The talks in Geneva were very friendly. The relationship is very good. We're not looking to hurt China."However, some tariffs are not included in the agreement, such as those on cars, steel, and aluminum, leaving tariffs on China higher than they were before the president started ramping them up last month. Adam Hersh, a senior economist at the Economic Policy Institute, said, "The chaotic tariff policy is still doing damage. It's still raising prices. It's still undermining American manufacturing and hurting working families, and it's still leading us on a path to recession."China has called this agreement an important step that lays the foundation for further cooperation, stating, "This initiative aligns with the expectations of producers and consumers in both countries and serves the interests of both nations as well as the common interests of the world."When asked if tariffs on China would go back up to 145% if there's no long-term deal at the end of 90 days, Trump said, "No, but they would go up substantially higher." Trump mentioned he may talk to Chinese President Xi Jinping at the end of the week, and the White House says the new tariff rates will kick in on Wednesday. Treasury Secretary Scott Bessent said in an interview with CNBC that U.S. and Chinese officials will meet again in a few weeks.