WASHINGTON - The United States and China have reached an agreement on phase one of a trade deal, Chinese officials said Friday. President Donald Trump confirmed the news in a tweet shortly afterward.

The announcement comes after almost a year and a half of posturing between the world's two largest economies that centered on trade imbalances, access to markets and concerns about intellectual property theft.

The precise conditions of the agreement are still being negotiated, but the U.S. will begin to remove some of the tariffs it has levied on Chinese goods, China's Vice Commerce Minister Wang Shouwen said Friday during a press conference.

The U.S. will continue to levy a 25 percent tariff on approximately $250 billion of imported Chinese goods, the Office of the U.S. Trade Representative (USTR) said Friday. Tariffs on another $120 billion would be reduced to 7.5 percent, according to a statement from the USTR.

The agreement also delays the implementation of a 15 percent tariff on $156 billion in Chinese imports, primarily consumer goods such as toys, clothes and electronics, which had been scheduled to take effect on Sunday.

The U.S. agreed to a so-called phase one trade deal with China in principle, sources told CNBC. As part of the deal, the U.S. would scrap additional levies set to take effect on Sunday. The U.S. also proposed cutting tariffs on $360 billion in Chinese goods by up to 50%. One of the sources also told CNBC that President Donald Trump was focused on how much in U.S. agricultural products China would purchase.

"This has been going on for a while and we finally have good news," said Mike Wilson, chief U.S. equity strategist at Morgan Stanley, on CNBC's "Fast Money." "But the question is, how much has been priced in?"

Bloomberg News and Dow Jones later reported that Trump had signed off on the deal.

China and the U.S. have been fighting a trade war for nearly two years as the Trump administration tries to level what it sees as an uneven playing field. The trade war has dented business sentiment and has sparked volatile moves in capital markets.

Story Date: December 14, 2019