Shortly after 6pm on Wednesday night, President Trump posted a 159-word message on his Truth Social media platform that sent the world scrambling. He announced that he had authorised a 90-day pause in his tariffs, backing down in the face of relentless pressure in the bond markets.
No 10 had not been expecting it and was initially unsure about what it actually meant, since Trump had imposed a universal tariff of 10 per cent on the UK along with 25 per cent tariffs on exports of steel, aluminium and cars. Two hours later it received clarification from Trump’s administration that from the UK’s perspective nothing had changed.
The tariffs on the UK remain the same and it now finds itself in the same place as the European Union, despite pursuing a very different strategy.
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While Brussels has drawn up a €20 billion package of retaliatory tariffs, the UK has refrained and instead gone out of its way not to provoke Trump. There is no evidence, as yet, that this has resulted in preferential treatment.
More broadly Starmer believes that Trump’s climbdown is evidence that he is ready to do deals. Trump said as much himself, claiming that 75 countries have contacted the US in a bid to reduce tariffs and appearing to revel in their position as supplicants. Other countries, he said, are “calling us up, kissing my ass to negotiate”. He even invoked Oliver Twist. “Please Sir, make a deal. I’ll do anything. I’ll do anything sir.”
That’s not quite how No 10 would put it, but a deal between the US and the UK is on the table.
The broad outlines have been clear for some time — overhauling a tax on digital services that predominantly hits Silicon Valley tech giants and lowering tariffs on agricultural imports.
The question now is how far is Trump willing to bend. In an interview on Wednesday the prime minister was candid when he was asked whether Trump would be prepared to lift the 10 per cent baseline levy. “Look I don’t know,” he told ITV. “We are negotiating and we hope to improve the situation.”
The thinking in government is that the 10 per cent tariff is here to stay. Attention is increasingly turning to persuading Washington to cut the 25 per cent tariff on the import of cars, the biggest single export item to the US.
Either way, a deal does not appear to be imminent with the US currently poised to announce a 25 per cent tariff on pharmaceutical imports.
The prime minister hopes to get his deal over the line by the end of the month but there is no specific deadline, with Trump and his team focused on discussions with larger economies elsewhere, particularly in Asia.
The US has indicated that it is coming back for more now that tariffs are in place, particularly on agriculture. Trump has repeatedly demanded that Britain accept imports of chlorine-washed chicken from the US and hormone-treated beef, something that Starmer has refused to relent on.
Starmer remains optimistic that his approach will yield results. However, if the events of this week demonstrate anything they provide a reminder of the sheer unpredictability of Trump, and that many in the White House — let alone those in No 10 — have no idea what he is going to do next.
