US President Donald Trump announced a new trade deal with the United Kingdom on Thursday. This agreement reduces tariffs (taxes on imports) on cars and metals, but the 10% baseline tariff on many goods will remain unchanged.
Under the deal, US tariffs on British cars will be lowered from 27.5% to 10% for up to 100,000 vehicles. Tariffs on steel and aluminum will be completely removed. In return, the UK has agreed to buy more US farm products, simplify customs for American goods, and lower taxes on around 2,500 items like olive oil, wine, and sports equipment.
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Trump also warned that other countries negotiating trade deals with the US might face higher tariffs. He mentioned that countries with which the US has trade deficits (importing more from them than it exports) could face steeper import taxes.
The announcement caused US stocks to rise as investors felt more optimistic about the trade deal, believing it could help avoid a recession by easing some tariffs and restrictions.
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UK Prime Minister Keir Starmer joined Trump for a video call from the White House, calling the agreement “a truly fantastic and historic day.”
