Trump drops tariff threat against EU after weekend call with bloc chief

Thomson Reuters

· Posted: May 26, 2025 9:10 AM EDT | Last Updated: 3 hours ago

A play telephone telephone betwixt U.S. President Donald Trump and EU main Ursula von der Leyen gave "new impetus" to commercialized talks, the EU said connected Monday, aft Trump dropped his menace to enforce 50 per cent tariffs connected imports from the European Union adjacent month.

Trump restored a July 9 deadline to let for talks betwixt Washington and the 27-nation bloc to nutrient a woody aft what helium said was "a precise bully call" with von der Leyen connected Sunday, which an EU spokesperson said had been initiated by her.

The euro deed a one-month precocious against the dollar connected Monday, portion European shares surged and were poised to recoup the erstwhile session's losses. Gold prices fell arsenic Trump's latest determination reduced request for the safe-haven asset.

The U.S. and EU commercialized representatives were owed to clasp talks connected Monday afternoon, European time, the European Commission spokesperson said, declining to springiness immoderate accusation astir the contented of the telephone betwixt Trump and von der Leyen.

"There's present besides a caller impetus for the negotiations, and we volition instrumentality it from there," the spokesperson said. "They agreed some to fast-track the commercialized negotiations and to enactment successful adjacent contact."

German Economy Minister Katherina Reiche called for tariff negotiations to proceed calmly. "We person to find a communal path," she said.

WATCH | Trump recommends 50 per cent tariff connected EU: 

Trump had said connected Friday that helium was recommending a 50 per cent tariff effectual from June 1, expressing vexation that commercialized negotiations with the EU were not moving rapidly enough. The menace roiled planetary fiscal markets and intensified a commercialized warfare that has been punctuated by predominant changes successful tariff policies toward U.S. trading partners and allies.

The U.S. president's softened stance 2 days aboriginal marked different impermanent reprieve successful his erratic commercialized policy, adjacent if the latest displacement successful decision-making reminded policymakers and investors however rapidly circumstances could change.

"It is imaginable that a woody with the European Union volition beryllium reached by 9 July," Commerzbank currency strategist Michael Pfister said.

"However, it is questionable what has changed successful presumption of the cardinal problems pursuing a telephone call. One happening should beryllium wide aft Friday's announcement: the little respite from tariffs that we enjoyed was lone temporary."

European companies connected edge

EU commercialized main Maros Sefcovic was scheduled to person a video league connected Monday with the CEOs of Mercedes-Benz, Volkswagen, BMW and Stellantis, arsenic businesses wondered what plans, if any, they should make.

Despite the relief, Germany's family-owned LAPP Group, which makes everything from cables and wires to robotics for factories, warned that immoderate of its specialized products would inactive beryllium affected by the planned tariffs, and the volatile concern environment.

"Unfortunately, existent U.S. authorities is characterized by unpredictability, idiosyncratic interests and populism," CEO Matthias Lapp told Reuters.

"Germany's bully transatlantic relations person been built up implicit decades of diplomatic enactment and communal understanding. However, assurance successful their stableness is presently suffering monolithic damage," helium said.

WATCH | Trump tariff threats a headache for French winemakers: 

Trump, who has repeatedly expressed disdain for the EU and its attraction of the United States connected trade, relented aft European Commission President von der Leyen told him connected Sunday that the EU needed much clip to travel to an agreement.

She asked him during a telephone to hold the tariffs until July, the deadline helium had primitively acceptable erstwhile helium announced caller tariffs successful April. Trump told reporters helium had granted the request.

"I agreed to determination it," Trump said earlier returning to Washington aft a play successful New Jersey. "She said we volition rapidly get unneurotic and spot if we tin enactment thing out."

Von der Leyen said successful a station connected X that she had a "good call" with Trump and that the EU was acceptable to determination quickly.

"Europe is acceptable to beforehand talks swiftly and decisively," she said. "To scope a bully deal, we would request the clip until July 9."

The negotiations had been stuck, with Washington demanding unilateral concessions from Brussels to unfastened up to U.S. concern portion the EU seeks an statement successful which some sides could gain, according to radical acquainted with the talks.

The EU already faces 25 per cent U.S. import tariffs connected its steel, aluminum and cars and alleged "reciprocal" tariffs of 10 per cent for astir each different goods, a levy that had been owed to emergence to 20 per cent after Trump's 90-day intermission expires successful July.

The levy could summation to 50 per cent in a no-deal scenario, which could rise user prices connected everything from German BMWs and Porsches to Italian olive lipid and wounded request for French luxury handbags.

It was not clear, however, whether the 50 per cent tariff menace would use to each EU imports oregon conscionable those taxable to the U.S. "reciprocal" tariff, which does not use to alloy and cars and different products taxable to investigations, specified arsenic semiconductors, pharmaceutical products and lumber.