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President Trump’s team is no longer aiming for big trade deals with many countries, according to a report in the Financial Times on Tuesday. Instead, they are trying to make smaller, quick agreements before July 9, when Trump plans to bring back his toughest tariffs.
These mini deals would help countries avoid those harsh levies, but partners would still face existing tariffs while talks continue. Talks continue to take place and Trump is still threatening new tariffs on key sectors like cars, steel, and aluminum.
Trump’s self-imposed July 9 deadline, when Trump’s “pause” on his sweeping April duties expires, fast approaching, with the president and top administration officials providing mixed signals on its malleability while countries race to finalize talks.
Trump said Sunday that he didn’t think he’d “need to” extend that deadline, while Treasury Secretary Scott Bessent on Monday warned “recalcitrant” countries that a return to steep “Liberation Day” tariffs looms.
In another sign on Monday that the president was moving forward on his threat to send letters to countries rather than waiting to finalize interim deals, Trump posted on Truth Social that he would be sending Japan a letter with a new tariff rate, citing an unwillingness by the country to accept US rice exports.
Meanwhile, the European Union signaled it was willing to accept a 10% universal tariff on many of its exports but is seeking exemptions for pharmaceuticals, alcohol, semiconductors, and commercial aircraft as part of a trade deal, Bloomberg reported. The EU is also seeking quotas and exemptions to lower duties on autos, steel, and aluminum, the report said.
On the North American front, Canada scrapped its digital services tax on US technology companies, such as Apple (AAPL), Amazon (AMZN), and Alphabet (GOOG, GOOGL) late on Sunday, just hours before it was set to start. The White House said trade talks between the two countries had resumed after Trump threatened to cut off trade talks.
Read more: What Trump’s tariffs mean for the economy and your wallet
Here are the latest updates as the policy reverberates around the world.
LIVE 1297 updates
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EU toughens stance on Donald Trump’s tariffs as deadline looms
The European Union has hardened its stance in trade trade talks with US President Donald Trump and are insisting the US drops its tariffs on the EU immediately as part of any framework deal ahead of the July 9 deadline.
Trade commissioner Maroš Šefčovič has been told he must take a tougher line on his trip to Washington this week as Brussels attempts to remove or at least cut Trump’s levies in the long term.
The FT reports:
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Japan’s trade strategy tested as Trump pushes for quick deals
Bloomberg reports:
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Powell: Fed likely would have cut rates if not for tariffs
Federal Reserve Chair Jerome Powell said that tariffs are causing the central bank to take its time before cutting interest rates.
Powell is speaking today about the Fed’s policy stance at an ECB forum in Sintra, Portugal. When asked if the Fed would have cut interest rates by more by now if it weren’t for higher tariffs, Powell stated, “I think that’s right.”
“In effect, we went on hold when we saw the size of the tariffs,” Powell continued. “Essentially, all inflation forecasts for the United States went up materially as a consequence of the tariffs.”
Powell noted that the US economy remains healthy overall but that he expects to see the effects of tariffs if they filter through the economic data in the coming months. In recent days, Powell has faced increased pressure from President Trump to lower interest rates, including in the form of handwritten notes.
“Ignore the tariffs for a second,” Powell said of the economy. “Inflation is behaving pretty much exactly as we have expected and hoped that it would. We haven’t seen effects much yet from tariffs, and we didn’t expect to by now.”
Watch Powell speak live below:
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CEO spends 1.83M Amex points to pay surprise tariff bill
Perhaps the moral of this story really is — as Amex likes to say — “Don’t leave home without it.” Nowhere was this more true than for CEO Robert Keeley, who when faced with an $11,000 tariff bill decided to cash in 1.83 million American Express reward points to pay it.
Bloomberg News reports:
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6 questions facing US stock investors as 2025’s second half kicks off
From President Trump’s tariffs to the Federal Reserve rate cut saga, the US stock market has just completed a roller-coaster first half of the year. The S&P 500 (^GSPC) is up 5% year to date, rebounding from its April slump after Trump’s “Liberation Day” tariffs were announced. But what should investors watch for in the second half of 2025? Here’s a look at six key questions facing US stock investors at the start of the second half.
Reuters reports:
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EU wants upfront relief for key sectors in any US trade deal: Sources
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India seeks to seal interim trade deal with US this week
It seems that President Trump will bag a second trade deal soon. India is currently on track to seal an interim trade agreement with the US as soon as next week, according to a report in the FT on Tuesday.
The FT, who received exclusive information from people briefed on the talks, reported that an interim deal between the US and India would be a step closer to a comprehensive bilateral accord between Washington and New Delhi. It would also be the first with a major US trading partner.
The FT reports:
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US narrows trade focus to secure deals before Donald Trump’s tariff deadline
President Trump’s team has decided to focus on smaller trade deals instead of big, wide-ranging agreements, according to a report in the FT, who cited people familiar with the matter.
The Trump administration is hoping these quick deals will stop the US from bringing back tough tariffs. Officials want to reach phased deals with countries that are most ready to talk before July 9. That is when Trump plans to reimpose harsh tariffs if no agreements are made.
These smaller deals mean countries could avoid the worst tariffs for now. But they would still face some existing tariffs while talks on harder issues continue.
Talks remain complicated and Trump is also thinking about new tariffs on key industries. This approach shows how he uses the threat of tariffs to push countries to agree to US demands.
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EU prepared to accept Trump’s universal tariff but seeks key exemptions
The European Union, looking to clinch a trade deal with the US before a July 9 deadline, is prepared to accept a “universal” tariff of 10% on goods exported to the US, according to a Bloomberg report Monday.
But the bloc is seeking exemptions on key sectors, including pharmaceuticals, alcohol, semiconductors and commercial aircraft.
From Bloomberg:
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Trump says he will be sending Japan a letter, threatening new tariff levels
President Trump said on Monday afternoon he was willing to impose a higher tariff rate on Japan, saying the country refused to accept US rice exports.
“To show people how spoiled Countries have become with respect to the United States of America, and I have great respect for Japan, they won’t take our RICE, and yet they have a massive rice shortage,” Trump posted on Truth Social. “In other words, we’ll just be sending them a letter, and we love having them as a Trading Partner for many years to come.”
Trump’s statement that he would send a letter to Japan outlining the new tariff rate comes a little more than a week before a July 9 deadline and after months of being locked in trade talks with Japanese leaders. Trump has threatened to send letters to trading partners should negotiations break down.
During trade talks, Japan has sought an exemption from the Trump administration’s 25% auto duties. Broad tariffs on Japanese goods were set to jump back up to 24% on July 9 if no deal is reached and the tariff pause is not extended.
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Hassett: Canada trade talks to restart ‘immediately’ after country scraps tax
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Bessent warns countries on July 9 deadline
Treasury Secretary Scott Bessent warned “recalcitrant” countries that their tariff levels could soon snap back to “Liberation Day” levels, the latest sign of ambiguity in President Trump’s firmness around a July 9 deadline.
Via Reuters:
Administration officials — and Trump himself — have sent mixed signals on whether he may look to extend that deadline. Trump on Sunday suggested he didn’t think he’d “need to” extend it.
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Tariffs start to bite as US prices of China-made goods jump on Amazon
Tariffs pressures have started to hit goods, with prices on products made in China sold on Amazon (AMZN) rising faster than overall inflation, according to 1,400 different items which were analysed by DataWeave and provided exclusively to Reuters.
Reuters reports:
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This could be the summer of economic hell
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EU Commission: EU tech rules not included in US trade talks
The European Union is pushing back against the US and its criticism of the bloc’s tech rules, which many feared may have been included as part of trade negotiations.
Reuters reports:
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Fed versus Trump on tariffs impact will soon be put to the test
There is a belief among economists that President Trump’s tariffs will help boost inflation over the next few months. But so far, muted price increases have called that belief into question. This has helped to embolden Trump, causing divisions with the Fed.
Bloomberg News reports:
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Trading partners brace for US tariff deadlines
South Korea is looking for an extension to the July 9 tariff deadline as talks continue. The US has raised concerns over non-tariff barriers and broader defence. South Korea is not the only country looking to reach a deal with the US before the tariff deadline on July 9.
“It seems some countries will reach a deal by July 8, some might be granted an extension to continue negotiations, while others will decide if they want to continue negotiating under tariffs or not,” the South Korean official told a briefing.
Here’s how some of the other trading partners are managing the deadline.
China
The US and China reached a deal to resume rare earth exports in London this month, resolving delays in implementing the Geneva agreement, which was established in May. Both sides are keen to ease tensions before tariffs rise further on August 9, when broader duties could rise 50%.
Canada
Canada scrapped its planned digital services tax targeting US tech firms on Sunday in an attempt to revive stalled talks. President Trump threatened new tariffs within a week if no deal is reached. According to Reuters, talks aim for an agreement by July 21.
EU
EU negotiators are pushing to keep reciprocal tariffs below 10% but Washington is pursuing a 10% baseline rate on most goods. Talks continue as the EU faces a looming deadline of July 9.
UK
The US-UK trade deal was cemented at the G-7 Summit this month. The deal came into force this week, reducing levies on cars and aircraft parts but keeping 10% tariffs on exports. Steel and aluminium tariffs remain unresloved ahead of the July 9 deadline.
Japan
Japan is seeking exemption from US auto tariffs, which currently stand at 25%, while also facing a new 24% reciprocal tariff from July 9. Trump wants Japan to import more US energy to reduce its trade surplus.
Mexico
The US and Mexico are negotiating a quota deal to reduce Trump’s 50% steel tariffs. An agreement may allow for lower import rates.
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Goldman: US profit margins face key risk from tariffs
As earning season approaches, Goldman Sachs (GS) said on Monday that US profit margins will be tested as investors await to see how President Trump’s war has hurt companies.
Goldman’s David Kostin said Q2 earnings will show the immediate impact of tariffs, which have risen about 10% this year. Most costs will be passed on to consumers, but margins will suffer if firms absorb more than expected.
Early results are mixed: General Mills (GIS) stock fell 5% last week due to a weak forecast and tariff warning, while Nike (NKE) rose 15% after announcing it will offset higher duties.
Bloomberg News reports:
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Canada rescinds digital services tax to advance stalled US trade talks
Canada scrapped its planned digital services tax on US tech firms late Sunday, just hours before it was due to start.
The move aims to revive stalled trade talks with the US, which halted on Friday over the tax, with President Trump calling it a “blatant attack.”
Canada’s finance ministry said Prime Minister Mark Carney and Trump plan to reach a deal by July 21.
Trump warned on Friday he would set new tariffs on Canadian goods within a week, risking fresh tension between the two countries.
The 3% tech tax would have hit firms like Apple (AAPL), Google (GOOG), and Amazon (AMZN), but Canada will now bring forward legislation to cancel it.
“The DST was announced in 2020 to address the fact that many large technology companies operating in Canada may not otherwise pay tax on revenues generated from Canadians,” a statement from the Canadian finance ministry said. “Canada’s preference has always been a multilateral agreement related to digital services taxation.”
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With 10 days to go, Trump admin coming up short of predicted tariff deals
Despite predictions from members of President Trump’s administration that it could complete “90 deals in 90 days,” the White House doesn’t appear to be anywhere close to the sweeping global trade reform it was seeking, Bloomberg reports:
