Starmer says it's 'early days' after Trump tariff threat

Sir Keir Starmer has said it is "early days" when it comes to the possibility of Donald Trump imposing tariffs on the UK.

Speaking at a joint news conference with NATO's general secretary Mark Rutte, the prime minister said the need for "open and strong" trading relations formed the basis of his discussions with the new US president so far.

It comes after Mr Trump suggested he is poised to expand his tariff regime to both the UK and the EU, but added that he thinks a deal can be done with Britain.

Asked by Sky News's political editor Beth Rigby if he is worried, Sir Keir said: "On the question of tariffs it's early days, and I think what's really important is open and strong trading relations and that has been the basis of my discussions with President Trump."

The FTSE 100 index of leading UK shares fell sharply on Monday after Mr Trump's comments.

Asked by the BBC if he will target the UK with tariffs, the US leader had said: "UK is out of line but I'm sure that one... I think that one can be worked out."

Mr Trump was referring to trade deficits - when you import more goods from another country than you send there in return.

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UK ministers have previously suggested the UK could avoid US tariffs as it does not have a trade deficit with Britain.

Reacting to Mr Trump's comments, a Downing Street spokesman said earlier that the UK and US "have a fair and balanced trading relationship which benefits both sides of the Atlantic".

"We look forward to working closely with President Trump to continue to build on UK-US trading relations for our economy, businesses and the British people," the spokesman added.

The US represents 18% (£300bn) of the UK's trade and the countries are each other's single largest investors with £1.2trn invested in each other's economies.

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According to US figures, America ran an overall trade surplus with the UK in 2023, amounting to $14.5bn - which would put the UK in a favourable position if Mr Trump targets harsher tariffs where there is a significant deficit.

However, the UK's Office for National Statistics reports that the UK ran a trade surplus with the US of £71.4bn (around $89bn) in 2023.

As our economics and data editor Ed Conway explains, either way both figures are very small and the numbers are essentially balanced.

Despite his threat, Mr Trump also had positive words for the UK when he said discussions with the prime minister have "been very nice".

"We've had a couple of meetings. We've had numerous phone calls. We're getting along very well," he said.

He struck a different tone when talking about the EU, saying tariffs will "definitely" be placed on goods from the bloc as America's trade deficit with it is "an atrocity" and "they take almost nothing and we take everything from them".

The comments and the subsequent market fallout, also seen in Europe, have somewhat overshadowed Sir Keir Starmer becoming the first UK leader to meet all 27 EU chiefs since Brexit.

During a Q&A after his news conference with Mr Rutte, Sir Keir said the UK will "stay resolute" in its commitment to working with both the US and the EU as he insisted that Britain is "not choosing between" them.

Elsewhere, Mr Trump has announced he will impose 25% trade taxes on goods coming from America's nearest neighbours and largest trade partners - Canada and Mexico - as well as a 10% levy on Chinese goods.

The Mexican president later said she will send 10,000 soldiers to the US border in a deal with Mr Trump to "pause" the 25% tariff.

Canada, Mexico and China have all vowed to slap tariffs on US goods, sparking fears of a global trade war.

(c) Sky News 2025: Starmer says it's 'early days' after Trump tariff threat