UK’s Reeves bullish on US tariff deal, dismisses countermeasures

UK Chancellor Rachel Reeves expressed optimism that Britain can negotiate an agreement with the US to avoid sweeping steel and aluminum tariffs imposed by President Donald Trump. She also ruled out retaliatory measures, emphasising her opposition to trade barriers.

“I strongly believe that a deal can be done,” Reeves said on The Political Party podcast Monday, ahead of Trump’s decision to impose 25 per cent tariffs on all US imports of the metals. When asked about potential retaliation, she stated, “I don’t believe in tariffs. I don’t want to see more tariffs.”

The UK is pushing for an exemption, arguing that its balanced trade relationship with the US should weigh in its favour. The British steel industry has warned that the tariffs, set to take effect March 12, would be a “devastating blow.”

“Balanced trade – and that’s what the UK and the US have, there’s not a surplus or deficit, our trade is pretty much balanced — there’s not really a problem there that needs to be addressed through tariffs or any other sort of barriers,” Reeves stated.

Hopes for an exemption rose after Trump suggested he would consider sparing Australian steel due to the US-Australia trade surplus. Australian Prime Minister Anthony Albanese said discussions were ongoing.

Reeves highlighted that about 10 per cent of British steel is exported to the US, while the UK also imports steel from America. Unlike the EU, which has vowed “firm and proportionate countermeasures,” she argued retaliation would harm the UK economy.

“If we tax things that come from America, the biggest losers then are people in our country who buy those things who are now paying more money for stuff that they paid less for before,” Reeves remarked. “It’s worse for America as well because the stuff there will become more expensive. It pushes up inflation: we’re trying to bring inflation down.”

Attribution: Bloomberg