China has agreed to cut tariffs on imported US cars from 40 per cent to 15 per cent, the first concrete sign of a cooling in the trade war between the world’s two largest economies since Xi Jinping and Donald Trump agreed a 90-day truce this month.

Liu He, the top Chinese economic official, told Steven Mnuchin, US Treasury secretary, and Robert Lighthizer, US trade representative, in a call on Monday evening, according to a person familiar with the conversation.

Worries about the prospects for a peaceful resolution to the trade dispute have rocked markets since the truce was agreed at a G20 summit in Argentina, with investors questioning whether the US and Chinese presidents would make substantive progress in the three-month ceasefire. The tariff cut was first reported by the Wall Street Journal.