Rachel Reeves has announced that the UK is not currently considering retaliatory tariffs against the US, despite Donald Trump’s recent imposition of a 25% tariff on all car imports. This decision led to a sharp decline in carmakers’ shares. Reeves stated that the UK does not want to escalate trade wars and is working to secure a favorable deal. The new tariffs on cars and light trucks will come into effect on 3 April and some US carmakers have seen a decline in shares following the announcement. European shares also decreased as carmakers are worried about the impact of the tariffs. The UK’s Society of Motor Manufacturers and Traders is calling for more government support in light of declining car production and weakening demand. Eurozone bond yields have fallen as traders’ interest rate expectations have shifted. The EU and Canadian leaders have condemned Trump’s decision, calling it a direct attack on their workers and warning of the potential harm it could cause to businesses and consumers.

Source: https://www.theguardian.com/us-news/2025/mar/27/carmaker-shares-fall-after-trump-25-tariff-move-as-reeves-warns-against-trade-war