President Trump announced his first trade agreement since initiating a global trade war, revealing a limited deal with the United Kingdom that reduces certain trade barriers—particularly on automobiles and agriculture—while leaving several critical issues unresolved. Speaking from the Oval Office, Trump described it as “a tremendous trade deal for both countries.”
UK Prime Minister Keir Starmer, joining the announcement by phone, called it a “fantastic, historic day.”
Though the agreement marks progress, it notably does not alter the 10% baseline tariffs Trump imposed broadly on global imports.
Under the pact, U.S. tariffs on UK steel will drop from 25% to zero, and tariffs on car exports will be cut from 27.5% to 10%, allowing the UK to export up to 100,000 vehicles to the U.S. at that rate.
Still, uncertainties remain.
Trump emphasized U.S. beef exports, yet acknowledged the UK’s strict standards are unlikely to change.
In return, the UK is offering concessions on digital services taxes affecting U.S. tech companies and pledging broader market access for U.S. products such as ethanol, machinery, and agricultural goods.
The agreement also includes fast-tracking certain exports and national security-related economic measures, including new aircraft engine orders from Boeing.
Business leaders praised the digital tax relief, with one calling it a “win-win” for tech firms. The stock market responded positively, reflecting hopes that Trump’s trade conflicts may be easing.
However, analysts were cautious. Some, like Henrietta Treyz of Veda Partners, labeled the deal underwhelming, noting that much larger negotiations with nations like China, India, and Canada remain unresolved.
Despite its limited scope, the deal is seen as a political and economic win for both Trump and Starmer.
The UK, unlike some countries hit harder by U.S. tariffs, may actually benefit slightly, according to a Yale Budget Lab report. This agreement follows another recent trade success for Starmer with India. Still, experts warn that the real test will come with upcoming negotiations, particularly with China.
Trump concluded with optimism, hinting that progress on broader trade issues may be close: “You can’t get any higher, so you know it’s coming down.”
