EU pauses countermeasures after Trump’s tariff reprieve; U.S. weighing deals

By Philip Blenkinsop, Joe Cash and Andrea Shalal

EU PAUSE

In Europe, euro zone government bond yields jumped, spreads tightened and markets scaled back their bets on European Central Bank rate cuts after Trump’s latest announcement. European shares surged.

Trump’s move was an important step towards stabilising the global economy, von der Leyen said. But she warned that counter-tariffs could be reinstated if necessary.

“If negotiations are not satisfactory, our countermeasures will kick in. Preparatory work on further countermeasures continues,” she said, before adding: “As I have said before, all options remain on the table.”

Trump’s reversal on tariffs is not absolute. A 10% blanket duty on almost all U.S. imports will remain in effect, the White House said. The announcement also does not appear to affect duties on autos, steel and aluminium.

The U.S. tariff pause does not apply to duties paid by Canada and Mexico, because their goods are still subject to 25% fentanyl-related tariffs unless they comply with the U.S.-Mexico-Canada trade agreement’s rules of origin.

USTR has informed us that there are maybe 15 countries now that have made explicit offers that we’re studying and considering and deciding whether they’re good enough to present the president,” Hassett told reporters at the White House, referring to the U.S. trade representative.

Principals in the administration’s trade policy will meet at the White House on Thursday to discuss how to prioritize the separate negotiations, Hassett said.

The EU was due to launch counter-tariffs on about 21 billion euros ($23.25 billion) of U.S. imports next Tuesday in response to Trump’s 25% tariffs on steel and aluminium. It is still assessing how to respond to U.S. car tariffs and the broader 10% levies that remain in place.

CREDIT: REUTERS