WASHINGTON – President Donald Trump touted a “breakthrough trade deal” between the U.S. and United Kingdom as he announced the first agreement since he imposed sweeping tariffs in April that ignited a global trade war and rattled financial markets.
Joined in the Oval Office by U.S. and UK officials who helped broker the agreement, Trump said the pact would boost trade between the two allies and remove “non-tariff barriers” he said “unfairly discriminate” against American products.
“There could be no more perfect morning to reach this historic agreement,” Trump said, noting that the agreement happened to fall on “Victory Day” in celebration of the end of World War II in Europe.
Yet it is unclear whether the deal with Britain ‒ the ninth largest trading partner with the U.S. ‒ will provide momentum for future trade agreements as the Trump administration seeks to rapidly hammer out deals with 170 countries. The U.S. has a $12 billion trade surplus with Britain, making it an outlier from other countries like China that export more goods to the U.S. than it imports.
Under the still-evolving deal, Trump kept a 10% baseline tariff on British products imported to the United States, but he said that’s a “low number” compared to the tariffs he wants to maintain for other counties.
The agreement lowers 25% universal tariffs on automobiles from the UK to 10%, while the 25% rate still applies to vehicles from other countries. Trump also agreed to eliminate 25% tariffs on steel from the UK.
Other details are still in the works, Trump said. Still, U.S. stocks traded higher in the immediate hours of the news spreading of a broad deal between the two longstanding global allies. Trump promised that their efforts would provide billions of dollars in access for U.S. agricultural products such as beef and ethanol.
“They’re opening up their country,” Trump said. “Their country is a little closed and we appreciate it.”
United Kingdom Prime Minister Keri Starmer was put on a speaker phone for the announcement and called it a “really fantastic, historic day” coinciding with the 80th anniversary of the key moment at the end of World War II.
“This is going to boost trade between and across our countries,” Starmer siad.
Trump had imposed reciprocal tariffs on a slew of countries April 2 but later paused most of them for 90 days, saying those nations’ leaders were eager to negotiate trade deals. Since then administration officials repeatedly have said they are close to making deals.
The UK wasn’t hit with a reciprocal tariff during Trump’s April roll out, but faced a 10% universal tariff and 25% tariffs that Trump imposed on foreign automobiles, steel and aluminum.
President Trump said he made a special exception for the United Kingdom by lowering auto tariffs from 25% to 10% to help high-end vehicles such as Rolls-Royce, Bentley and Jaguar vehicles that are manufactured in Britain.
“It’s a very special car, and it’s very limited number, too,” Trump said. “It’s not one of the monster car companies that makes millions of cars. They make a very small number of cars that are super luxury.”
“That’s really handmade stuff, they’ve been doing it for a long time in the same location,” he said. “So I said, ‘Let’s help the out with that one.’”
Trump said he will “rarely” make the same decision in negotiations with other countries when it comes to other foreign automobiles. – Joey Garrison
Senate Minority Leader Chuck Schumer cast doubt on the durability of President Donald Trump’s trade agreement with the United Kingdom, the details of which are not fully known.
Schumer, D-New York, said in a morning Senate floor speech, ahead of Trump’s announcement, that the trade deal “is likely to be built on quicksand.”
“And with this president, if past is prologue, who knows if this ‘deal’ will actually stick,” Schumer, D-N.Y., said.
Schumer added: “It would be hard to take anything the president says about this deal today seriously, because in all likelihood he will likely change his mind again.” – Francesca Chambers
Trump’s trade deal with the United Kingdom maintained a 10% universal tariff on the country.
Asked if trade deals with other countries also could result in tariffs staying at 10%, rather than the higher reciprocal tariffs the president threatened last month before pausing most of them, Trump said no.
“The template of 10 is probably the lowest,” he said, suggesting other countries could have a higher tariff. – Zac Anderson
The United Kingdom could begin sending more Aston Martin cars – the iconic ride for fictional spy James Bond – to the U.S. under the trade deal, but Trump said potential tariffs on foreign films were still open to discussion.
“James Bond has nothing to worry about, that I can tell you,” Trump said to laughter in the Oval Office.
Trump noted that he was friends with Sean Connery, the late Scottish actor who created the Bond character in film. Trump has two golf courses in Scotland, and Connery helped resolve a zoning dispute for the one in Aberdeen.
“Sean Connery was a friend of mine. He was a great guy,” Trump said. “He said, ‘Let the bloody bloke build his golf courses.’” – Bart Jansen
The United Kingdom said in a press release that the trade deal with the United States will help a steel industry “on the brink of collapse.”
The U.S. imposed 25% tariffs on foreign steel. The UK won’t face those tariffs now, according to the release.
“The Prime Minister negotiated the 25% tariff down to zero, meaning UK steelmakers can carry on exporting to the US,” the release states. – Zac Anderson
Responding to a question about the significance of the trade deal announced with the UK, Trump said it’s incorrect to suggest he’s overstating its importance.
“This is a maxed out deal,” he said, adding: “It’s a very big deal right now but I think it’s going to grow.” – Zac Anderson
Commerce Secretary Howard Lutnick said 10% tariffs would remain under the trade deal, but that the United Kingdom was opening its markets for an estimated $5 billion in U.S. beef, ethanol and machinery.
Lutnick said a 25% U.S. tariff on automobiles would be reduced to 10% for the first 100,000 vehicles. Lutnick also said the a British airline would announce later May 8 that it would buy $10 billion of Boeing planes. – Bart Jansen and Joey Garrison
Although the details of the trade deal are still unclear, Trump said the United Kingdom has agreed to reduce or eliminate the number of “non-tariff barriers that unfairly discriminated against American products.”
“This is now turning out, I think, really to be a great deal for both countries because it will be really great for the UK also,” Trump said.
United Kingdom Keir Starmer, talking through a speaker phone, touted the moment as a “fantastic, historic day” as the U.S. and Britain agreed to a trade deal.
“Really important deal,” Starmer said. “This is going to boost trade across our countries. It’s going to not only protect jobs, but create jobs, opening market access. And as you say, Donald, the timing couldn’t be more apt.” – Joey Garrison
In another trade arena, the Treasury Department announced May 8 it sanctioned a Chinese refinery and three port terminal operators for buying or helping deliver hundreds of millions of dollars worth of Iranian oil.
President Donald Trump had signed an executive order to block sales of Iranian oil as part of an economic pressure campaign against the Middle East country working to develop its own nuclear weapon.
“The United States remains resolved to intensify pressure on all elements of Iran’s oil supply chain to prevent the regime from generating revenue to further its destabilizing agenda,” Treasury Secretary Scott Bessent said in a statement. – Bart Jansen
Secretary of State Marco Rubio praised the trade deal with the United Kingdom as “an important step towards fair and reciprocal trade” with other countries around the world.
“Looking forward to the many great deals your administration will deliver for the American people!” Rubio wrote on social media. -Bart Jansen
U.S. stock markets rose in initial trading after Trump’s announcement of a trade deal with the United Kingdom.
The Dow Jones Industrial Average rose 198.6 points or 0.48% at the opening of trading May 8. The S&P 500 rose 32.3 points or 0.57% in initial trading. And the Nasdaq composite rose 182 points or 1.03% at the opening bell. – Reuters
Final details on Trump’s trade deal with the United Kingdom remain under wraps.
But the two nations exchange a much smaller amount of goods and services – largely cars and chemicals heading to the U.S. – than the U.S. does with its largest trading partners.
The U.S. exported nearly $80 billion in goods and services in 2024, according to the Census Department, while importing about $68 billion. That ranks the United Kingdom ninth in trade with the U.S.Machinery and transport equipment was also the main goods exported from the United Kingdom to the U.S. in 2023. Cars represented nearly half the UK exports to the U.S., ahead of Germany and the Netherlands, according to that country’s trade office.
Chemical exports, mostly for pharmaceuticals, account for nearly one-quarter of the exports to the U.S. They were the second largest group of UK commodities exported to the U.S.
The United Kingdom figures are dwarfed by U.S. trade with Mexico at $839 billion in goods and serves exchanging across the U.S.-Mexico border last year. Canada traded $762 billion in goods and services with the U.S., while China coming in at $582 billion in trade with the U.S.
Trump met with Canada’s Prime Minister Mark Carney on May 6, and talks are set to begin with China. – Bart Jansen
Trump’s announcement already is being met with skepticism.
University of Michigan economist Justin Wolfers told CNN he wouldn’t consider it a major trade deal, noting the United Kingdom only accounts for about 3% of U.S. trade.
“The president’s a showman, he’s going to tell you there’s all sorts of wonderful things about it,” Wolfers said. – Zac Anderson
Trump commented about the intense interest in the trade deals during a May 6 meeting with the prime minister of Canada.
“Everyone says: ‘When, when, when are you going to sign deals?” Trump said. “We don’t have to sign deals. We could sign 25 deals right now . . . if we wanted. We don’t have to sign deals. They have to sign deals with us. They want a piece of our market.”
The president also expressed frustration with the constant questions. “I wish they’d stop asking how many deals are you signing this week,” he said.
Treasury Secretary Scott Bessent told lawmakers during a May 6 committee hearing that deals could be signed soon.
“I would think that perhaps as early as this week we will be announcing trade deals with some of our largest trading partners,” Bessent said. – Zac Anderson
There are 18 countries that Treasury Secretary Scott Bessent described as “major trading partners.” He said negotiations have begun with all of them except China, but talks between U.S. and Chinese officials are now scheduled.
Bessent and U.S. Trade Representative Jamieson Greer are traveling to Switzerland on May 8, where they will meet with China’s “lead representative on economic matters.”
Chinese President Xi Jinping is also meeting on May 8 with Russian President Vladimir Putin in Moscow. Jinping told Putin their two countries should be “friends of steel”, as they pledged to boost cooperation to a new level at a time of heightened confrontation with the West.
At talks in the Kremlin, the two leaders cast themselves as defenders of a new world order no longer dominated by the United States. – Reuters/Zac Anderson
Contributing: Reuters