US and China are seeking to avoid further escalation in a trade war between the world’s two largest economies. Both nations have agreed the framework of a potential trade deal that will be discussed when their respective leaders meet later this week.

US treasury secretary Scott Bessent has indicated that increasing tariffs on China is “effectively off the table” following what he described as “very good” trade talks with his Chinese counterparts in Malaysia.

Asked about the status of the November 1 deadline, Bessent told CBS News’ “Face the Nation with Margaret Brennan” on Sunday that the tariff threat has “gone away” after two days of talks in Malaysia.

“I think we had a very good two-day meeting. I would believe that the- so it would be an extra 100% from where we are now, and I believe that that is effectively off the table. I’m not going to get ahead of the two leaders who will be meeting in Korea on Thursday, but I can tell you we had a very good two days.”

He added, “I would expect that the threat of the 100% has gone away, as has the threat of the immediate imposition of the Chinese initiating a worldwide export control regime.”

This comes after Bessent met with Chinese vice premier He Lifeng and discussed trade between the United States and China.

“My Chinese counterpart is the Vice Premier, He Lifeng, so we had a very good two days. We discussed a wide variety of issues, from the rare earth- from the rare earth magnets to trade, to substantial purchases of American agricultural products, to the Chinese helping us in this fentanyl crisis that we have in the US,” Bessent said on “Face the Nation with Margaret Brennan” on Oct. 26.

The Chinese government said in a statement that both negotiating teams “reached basic consensus on the arrangements to address respective concerns.”

Chinese foreign ministry spokesperson Guo Jiakun emphasized on Monday during a regular press conference that “during the consultation, under the guidance of the important common understandings between the two presidents, the two sides had candid, in-depth and constructive exchanges and consultation on important economic and trade issues of mutual interest, and reached basic consensus on the arrangements to address respective concerns. The two sides agreed to make further effort to work out the details and go through their respective domestic procedures for approval.”

US secretary of state Marco Rubio spoke on Monday with China’s director of the office of the CCP central foreign affairs commission and foreign minister Wang Yi.  The two discussed the importance of the U.S.-China relationship and the upcoming meeting between president Trump and state chairman Xi in Busan, Republic of Korea.

Wang Yi expressed the hope that the two sides will work in the same direction to pave the way for high-level interactions between China and the United States, and create conditions for the development of bilateral relations.

All eyes are now on the expected meeting between Trump and Chinese leader Xi Jinping on Thursday, which has already been colored by questions of whether it will even happen.

Thursday’s meeting will come after months of volatile moves in US-China relations, which have rattled the global economy. Markets will be watching closely to see if they can halt the trade war sparked by Trump’s sweeping tariffs.

Since Trump re-entered the White House, he has imposed and threatened sweeping tariffs on imports from overseas on various countries, arguing that the policy would help boost US manufacturing and jobs.

The introduction of tariffs has resulted in many countries agreeing new deals with the US.