Image copyright Getty Images Image caption The proposed tariffs would have hit a wide range of electronics, including all of Apple's major products

The US and China have announced a preliminary trade agreement.

The so-called phase one deal will see billions of dollars in tariffs removed or delayed.

US stocks hit a fresh record on hopes there will be a continued softening of trade tensions between the world's two largest economies.

A fresh wave of US tariffs on Chinese imports was due to take effect on Sunday. However, this has been cancelled for now.

"We will begin negotiations on the phase two deal immediately, rather than waiting until after the 2020 Election," US President Donald Trump said in a tweet. "This is an amazing deal for all."

If the new, higher tariffs had gone ahead, Chinese-made goods such as smartphones, clothing and toys would have become more expensive for Americans just ahead of Christmas.

US negotiators are reportedly offering to significantly reduce existing tariffs on about $360bn (£270bn) worth of Chinese imports.

In return, China has promised to buy large quantities of US soybeans, poultry and other agricultural products.

The agreement is a deal in principle, which means if China breaks any part of the agreement, the Trump administration has the ability to re-implement tariffs.

There's some festive cheer for American shoppers and businesses as the Christmas decorations, game consoles and iphones that were due to be hit with a 15% tariff are now off the hook.

The share of these goods coming from China is around 85%, according to Bloomberg analysis, which would have made it difficult for companies to source them from elsewhere.

America's business lobby group - the influential Business Roundtable has long been lobbying against the tariffs, saying they would be very damaging to the US economy. As the boss of JP Morgan Jamie Dimon put it "it's what happens to people's psyche and confidence and businesses".

The International Monetary Fund estimates that the US-China trade war could shave almost a percentage point off of global growth this year.

But there has been push back from others, such as Trump's trade advisor Peter Navarro, who feel the US should keep the pressure on what are widely accepted as China's unfair business practices. Replacing 'trade' with 'aid' (subsidies) for the American farmers who have suffered since China put reciprocal taxes on the likes of soybeans.

It's worth noting that this 'phase one' deal is just the beginning of the end. America imports $550bn dollars worth of products from China - and tariffs will remain on $370bn dollars of that.