Tensions between the United States (US) and China have had a significant impact on the global economy. This conflict began with a trade war, which triggered high tariffs on goods between the two countries, hurting companies and consumers around the world. These tensions lead to uncertainty that disrupts global supply chains, triggers investment diversion and affects the prices of goods. In the technology sector, the US implements strict controls on exports of processors and advanced technology to China. This not only disrupted technology companies, but also prompted Japan and South Korea to increase their control. Competition in technological innovation creates pressure on other countries to choose sides, driving divisions in the global technology market. In the manufacturing sector, many multinational companies choose to move production facilities to other countries such as Vietnam or India to avoid high tariffs. These changes result in increased production costs and adjustments in the home country that result in investment losses. As a result, countries that depend on exports to the US or China feel the direct impact of reduced trade volumes. In the capital market, US-China tensions affect global investor sentiment. Uncertainty regarding trade agreements and economic policies causes volatility in the stock market, with investors turning to safer assets such as gold or government bonds. Lower yields and rising inflation create challenges for central banks in formulating monetary policy. Economic growth in developing countries is also affected. The increase in commodity prices due to supply chain disruptions has an impact on inflation and people’s purchasing power. The creation of currency wars in response to aggressive trade policies, creates greater instability in the global economy. The social impact of these tensions cannot be ignored either. Economic uncertainty and declining employment fuel social discontent, which can fuel political tensions. Countries influenced by the US and Chinese economies may find themselves caught in a foreign policy predicament, having to choose sides and harming relationships with other markets. Shifts in geopolitics are leading to the formation of new alliances that seek to strengthen each country’s position. New initiatives, such as RCEP (Regional Comprehensive Economic Partnership) and China’s presence in the Belt and Road Initiative project, demonstrate this development. Other countries may have to adjust their foreign policies to remain adaptable to changing global dynamics. US-China tensions not only affect the economies of both countries, but also create a much wider global impact. Today’s world economy is closely intertwined, where one point of tension can trigger a chain reaction in other countries. In the future, it is important for all parties to look for profitable diplomatic channels to minimize the negative impacts that could result from this tension.