FX.co ★ U.S. Aims for Last-Minute Trade Pact with EU Ahead of Tariffs

U.S. Commerce Secretary Howard Lutnick expressed confidence in the possibility of securing a trade agreement between the U.S. and the EU before the August 1 deadline, which he described as a firm cutoff to avoid the implementation of new tariffs. In a CBS interview, Lutnick highlighted the significant potential for reaching an understanding, stating, "As the two largest trading entities globally, I am optimistic we will achieve a successful compromise." This follows President Trump's July 12 announcement of a potential 30% tariff on imports from both the EU and Mexico if progress in trade negotiations is not made by August 1. Additionally, Trump has issued notifications to other countries such as Canada, Japan, and Brazil regarding potential tariffs ranging from 20% to 50%, with copper facing a specific 50% rate. Lutnick reiterated that negotiations could persist post-August 1; however, new tariffs would be enforced from that date forward. Furthermore, he mentioned anticipated renegotiations of the United States-Mexico-Canada Agreement (USMCA) likely occurring next year, while clarifying that goods compliant with USMCA from Mexico and Canada remain exempt from these tariffs for the time being.