WASHINGTON — A trade deal with the United Kingdom announced by the White House on Thursday marked the first of its kind since President Trump launched sweeping global tariffs last month, offering a glimpse into the Trump administration’s negotiating strategy as it seeks to reset terms with trading partners around the world.
The agreement, hailed by Trump and U.K. Prime Minister Keir Starmer as “historic,” kept the U.S. baseline tariff rate on U.K. imports at 10%, while eliminating duties on British aluminum and steel and significantly lowering tariffs on a limited number of U.K. car exports.
In exchange, the White House said that London had agreed to lower barriers on U.S. farmers and ranchers seeking access to the U.K. market for exports like ethanol and beef, and to increase access for U.S. aerospace companies to critical British-made components.
While the White House called the agreement a “milestone” in its trade policy, U.S. officials also described the deal as merely the “end of the beginning” of talks to come over their trade relationship.
Starmer, describing the announcement as the “basis” of a deal, said he intended to continue negotiating with the administration to bring down its 10% baseline rate. “We would like to go further,” he said from a manufacturing plant in the West Midlands.
“But please do not underestimate the significance of the tariff reductions today, because these are measured in thousands of good-paying jobs across the country,” Starmer said.
Asked by a reporter whether Britain was better off in its trade relationship with America than it was a year ago, Starmer replied, “The question you should be asking is, is it better than where we were yesterday?”
The Dow Jones Industrial Average jumped 500 points on news of the deal, as Wall Street investors look for signs of progress in trade negotiations over five weeks out since Trump announced tariff increases on global trading partners, “friend and foe alike.”
Of the 10 largest U.S. trading partners, only the United Kingdom has a trade deficit with the United States. But the agreement will mean more to the British economy than it will to U.S. households. While the U.K. ranks eighth overall among U.S. trading partners, the United States is Britain’s largest, followed by the European Union.
Americans buy exponentially more goods from the United States’ three biggest trading partners — in Canada, Mexico and China — than from Britain, and there are few signs that U.S. talks with those three countries are closing in on trade deals.
And with goods from China still facing tariffs of 145%, U.S. importers and retailers are warning that price increases for American consumers will become visible within a matter of days.
From the White House, where he phoned Starmer to announce the deal to the press, Trump described the U.S.-U.K. agreement as “a great deal for both parties.”
“It opens up a tremendous market for us, and it works out very well. Very well,” Trump said. “The deal includes billions of dollars of increased market access for American exports, especially in agriculture, dramatically increasing access for American beef, ethanol, and virtually all of the products produced by our great farmers.”
“It’s very conclusive, and it’s a great deal, and it’s a very big deal, actually,” he added.
Trump underscored the potential for the export of up to $250 million in U.S. agricultural products to a market that had long been restricted to U.S. goods. But Starmer said that the U.K. government had drawn “red lines on standards” with regard to agricultural imports, raising questions over what exact products would be eligible.
Starmer said he hoped that the Trump administration would lower barriers on British pharmaceutical products in future talks, and also said the two governments were already discussing Trump’s proposed tariffs on foreign film production.
“There aren’t any tariffs in place on film at the moment,” Starmer said of the potential film tariffs, “and of course, we’re discussing it with the president’s team.”