The US has signaled it will not relax its August 1 deadline for higher tariffs against the European Union as the bloc struggles to reach a deal on time.

Over the weekend, US Commerce Secretary Howard Lutnick said he was confident a trade deal with the EU could be reached, but cautioned that the deadline for the 30% base tariffs was fixed.

"That's a tight deadline, so on August 1, the new tariffs will go into effect," Lutnick said Sunday on CBS News when asked about his EU tariff deadline.

He did hint that negotiations could continue beyond that date, stating: "These are the two largest trading partners in the world, who are negotiating. We will reach a deal. I'm confident we will reach a deal."

"There's nothing stopping countries from negotiating with us after August 1, but they will start paying tariffs on August 1," he added.

The EU has stated it is preparing retaliatory action against the US if punitive trade tariffs are imposed. However, Lutnick dismissed the possibility of the EU targeting goods like Boeing aircraft and Kentucky bourbon, saying, "They wouldn't do that."

Final-day negotiations for a trade deal are underway, with the EU hoping to negotiate lower tariffs. The bloc hopes to reach a similar pact with the UK, which was the first country to conclude a trade agreement with the US. That deal included a 10% base tariff with several conditions regarding imports of cars, steel, and aerospace.

However, economists and analysts are increasingly skeptical about Brussels' ability to agree on a similar framework.

First, the EU has a much more complicated relationship with US President Donald Trump than with the UK. Trump has frequently complained about what he considers an unbalanced trade relationship and unfair trade practices, which the EU denies.

According to the European Council, total trade between the EU and the US reached 1.68 trillion euros ($1.96 trillion) in 2024. While the EU has a surplus in goods trade, it has a deficit in services. Overall, the bloc recorded a surplus of around 50 billion euros last year, when both goods and services are taken into account.

Last Friday, the Financial Times reported that Trump was pushing for minimum tariffs of 15% to 20% on EU imports in any deal with the bloc. The president was also reportedly happy to maintain import duties on the auto sector at 25%, a move that would severely hurt German car exporters.

Speaking to CNBC's "Europe Early Edition" on Monday, Arnaud Girod, head of economics and cross-asset strategy at Kepler Cheuvreux, said tariffs of 15% to 20% "would be a complete disaster for European exports."

"Additionally, coupled with the strengthening of the euro that we're experiencing... that would start to weigh heavily and seriously hurt European exports, and, of course, also potentially, you know, reignite some inflation concerns in the U.S.," he added.(alg)

Sumber: CNBC