EU pauses countermeasures after Trump’s tariff reprieve

The European Union will pause its first countermeasures against US tariffs after President Donald Trump temporarily lowered the hefty duties less than a day after imposing them on dozens of countries, European Commission chief Ursula von der Leyen said on Thursday.

The Trump administration is weighing offers from more than a dozen countries on tariff deals and is close to reaching agreements with some of them, White House economic adviser Kevin Hassett said.

“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 US 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 US imports next Tuesday in response to Trump’s 25% tariffs on steel and aluminium. It is still assessing how to respond to US car tariffs and the broader 10% levies that remain in place.

“We want to give negotiations a chance,” von der Leyen said on X. “While finalising the adoption of the EU countermeasures that saw strong support from our Member States, we will put them on hold for 90 days.”

Trump’s sudden decision on Wednesday to pause most of his hefty new duties brought relief to battered markets and anxious global leaders, even as he ratcheted up a trade war with China.

His turnabout, which came less than 24 hours after steep new tariffs kicked in, followed the most intense episode of financial market volatility since the early days of the COVID-19 pandemic.

US stock indexes shot higher on the news, and the relief continued into Asian and European trading on Thursday.

Before Trump’s U-turn, the upheaval had erased trillions of dollars from stock markets and led to an unsettling surge in US government bond yields that appeared to catch Trump’s attention.

Trump kept the pressure on China, the world’s No. 2 economy and second-biggest provider of US imports, with an increase of tariffs on Chinese imports to 125% from the 104% level that kicked in on Wednesday.

He also signed an executive order aimed at reducing China’s grip on the global shipping industry and at reviving US shipbuilding.

TRADE WAR WITH CHINA

China rejected what it called threats and blackmail from Washington.

China will “follow through to the end” if the US persists, Commerce Ministry spokesperson He Yongqian told a regular press briefing. China’s door was open to dialogue, but this must be based on mutual respect, the ministry said.

Beijing may again respond in kind after already imposing 84% tariffs on US imports on Wednesday to match Trump’s earlier salvo.

Trump, who claims the tariffs aim to fix US trade imbalances, said a resolution with China on trade is also possible. But officials have said they will prioritize talks with other countries as Vietnam, Japan, South Korea and others line up to try and strike a bargain.

China’s yuan hit its lowest against the dollar on Thursday since the global financial crisis.

Agencies