EU Leader Postpones Retaliation as Deal Talks Continue

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EU Chief Delays Retaliation for US Tariffs in Search of a Deal

European Union President Ursula von der Leyen announced on Sunday that the bloc will continue to delay any retaliatory measures against US steel and aluminum tariffs. This decision comes as the EU seeks a negotiated solution to avoid broader 30% levies that could be imposed by the United States.

The situation escalated when US President Donald Trump, on Saturday, disrupted months of negotiations by announcing that the 27-nation bloc would face sweeping tariffs if no agreement is reached by August 1. In response, von der Leyen stated that the EU will extend the suspension of its countermeasures until early August, allowing more time for discussions.

“The United States has sent us a letter with measures that would come into effect unless there is a negotiated solution, so we will therefore also extend the suspension of our countermeasures until early August,” von der Leyen told journalists. She emphasized that the EU remains committed to finding a negotiated solution and will use the remaining time effectively.

This move has sparked hope that Trump’s latest threat, which also targeted Mexico, has not completely derailed the progress made in negotiations between Brussels and Washington. The current suspension of the EU's retaliation over US steel and aluminum tariffs was set to expire overnight on Monday to Tuesday, but it has now been extended.

Ready to Respond

Despite the extension, the European Union has prepared duties on US goods worth approximately 21 billion euros ($24 billion) in response to the levies imposed by Trump earlier this year. However, in April, the EU decided to hold off on these measures to create space for a broader trade agreement with the Trump administration.

Von der Leyen stated that the EU has always been clear about its preference for a negotiated solution and remains committed to this approach. “We’ve prepared for this, and we can respond with countermeasures if necessary,” she added.

EU trade ministers are set to meet in Brussels on Monday to discuss the bloc’s response to Trump’s latest move and determine how strong a stance to take with Washington. German Chancellor Friedrich Merz expressed concerns that if the threatened tariffs were implemented, they would undermine efforts to revive the economy and hit exporters hard. He agreed with French President Emmanuel Macron, who called for the EU to step up the preparation of credible countermeasures in case no deal is reached before August 1.

Macron also urged the European Commission, which negotiates on behalf of all EU countries, to "resolutely defend European interests."

Meloni’s Warning

Italian Prime Minister Giorgia Meloni issued a warning on Sunday, stating that a trade war within the West would weaken all parties involved in the face of global challenges. “Europe has the economic and financial strength to assert its position and reach a fair and sensible agreement,” she said.

Since returning to the presidency in January, Trump has imposed sweeping, stop-start tariffs on allies and competitors alike, causing market turmoil and raising fears of a global economic downturn. However, his administration is under pressure to secure deals with trading partners after promising a flurry of agreements.

So far, US officials have only unveiled two pacts, with Britain and Vietnam, alongside temporarily lower tit-for-tat duties with China. The European Union, along with dozens of other economies, had been set to see its US tariff level increase from a baseline of 10% on July 9, but Trump pushed back the deadline to August 1.

In a letter published on Saturday, Trump cited the United States’s trade imbalance with the bloc as justification for the new 30% levies. The EU tariff is significantly steeper than the 20% levy Trump had introduced in April before pausing it due to market concerns.