Rachel Reeves understands Trump’s considerations forward of commerce talks

The chancellor says she “understands what President [Donald] Trump needs to handle” along with his tariffs, forward of talks along with her US counterpart in Washington on Friday.

Rachel Reeves mentioned there have been similarities with the best way each the US and UK governments had come to energy off the again of voter frustration with the financial system.

Forward of her assembly with US Treasury Secretary Scott Bessent, Reeves mentioned the federal government was working “flat out” to safe a commerce take care of the US.

Earlier this week, she signalled the UK might decrease tariffs on US automobile imports from their present 10% to 2.5% as a part of a wider deal.

“We’re all grappling with this difficulty of tariffs however I believe that there’s an understanding why President Trump needs to handle among the world imbalances there are within the system,” she mentioned.

Trump has already imposed tariffs of 25% on all automobile imports to the US together with from the UK.

The UK additionally faces a broader tariff price of 10% and is seeking to negotiate an settlement with the US administration, together with dozens of different international locations hit with even increased levies – most of that are presently on pause till July.

Some US officers have been optimistic concerning the prospects of a deal. Final week US Vice-President JD Vance mentioned there was a “good likelihood” a commerce deal could possibly be reached with the UK.

Reeves mentioned she had additionally been working intently with European and Canadian counterparts to take away commerce boundaries, and that conversations across the desk at G20 conferences this week had been troublesome.

“Clearly there are strains. We’re all following what’s occurring in our home bond markets, in our fairness markets, and everyone knows that that uncertainty is unhealthy for funding within the UK financial system.”

Reeves went on to say there wouldn’t be any celebrations if the UK obtained a deal as different international locations had been nonetheless affected.

Regardless of the chancellor’s give attention to talks with the US, she prompt that transferring nearer to the EU on commerce was an even bigger precedence. The UK is getting ready for a summit with the EU in Could in an try to “reset” the connection between the 2.

“I perceive why there’s a lot give attention to our buying and selling relationship with the US however truly our buying and selling relationship with Europe is arguably much more necessary, as a result of they’re our nearest neighbours and buying and selling companions,” she mentioned.

“Clearly I have been assembly Scott Bessent this week while I am in Washington, however I’ve additionally this week met the French, the German, the Spanish, the Polish, the Swedish, the Finnish finance ministers – as a result of it’s so necessary that we rebuild these buying and selling relationships with our nearest neighbours in Europe, and we’ll do this in a method that’s good for British jobs and British customers.”