EU delaying retaliatory tariffs on US, hopes to reach deal by Aug 1

The EU will suspend retaliatory tariffs on US goods scheduled to take effect Monday in hopes of reaching a trade deal with the Trump administration by the end of the month.

"This is now the time for negotiations," European Commission President Ursula von der Leyen told reporters in Brussels on Sunday, after President Donald Trump sent a letter announcing new tariffs of 30% on goods from the EU and Mexico starting Aug 1.

The EU America's biggest trading partner and the world's largest trading bloc had been scheduled to impose "countermeasures" starting Monday at midnight Brussels time (6 pm EDT). The EU negotiates trade deals on behalf of its 27 member countries.

Von der Leyen said those countermeasures would be delayed until Aug 1, and that Trump's letter shows "that we have until the first of August" to negotiate. European leaders have urged Trump and von der Leyen to give negotiations more time.

"We have always been clear that we prefer a negotiated solution," she said. If they can't reach a deal, she said that "we will continue to prepare countermeasures so we are fully prepared".

Standing alongside Indonesian President Prabowo Subianto, von der Leyen said the trade tensions with the US show the importance of "diversifying our trade relationships". 

Trump has said his global tariffs would set the foundation for reviving a US economy that he claims has been ripped off by other nations for decades. Trump in his letter to the European Union said the US trade deficit was a national security threat.

US trade partners have faced months of uncertainty and on-and-off threats from Trump to impose tariffs, with deadlines sometimes extended or changed. The tariffs could have ramifications for nearly every aspect of the global economy.

The value of EU-US trade in goods and services amounted to 1.7 trillion euros ($2 trillion) in 2024, or an average of 4.6 billion euros a day, according to EU statistics agency Eurostat.

Europe's biggest exports to the US were pharmaceuticals, cars, aircraft, chemicals, medical instruments and wine and spirits.

Trade ministers from EU countries are scheduled to meet Monday to discuss trade relations with the US, as well as with China.