President Donald Trump unveiled the first trade agreement of his second term on Thursday, announcing a comprehensive bilateral deal with the United Kingdom that maintains a 10% baseline tariff while reducing automobile import rates and eliminating steel and aluminum levies. The breakthrough announcement triggered a 650-point surge in the Dow Jones Industrial Average as Wall Street welcomed signs of de-escalation after weeks of global trade tensions and economic uncertainty.

President Trump revealed the bilateral trade pact during an Oval Office press conference, calling it “the first of many” upcoming international agreements. The framework reduces tariffs on British automobiles from 27.5% to 10% for 100,000 vehicles annually and completely removes levies on UK steel and aluminum exports to the United States. Commerce Secretary Howard Lutnick emphasized that the United Kingdom would join the US in imposing reciprocal 25% tariffs on foreign steel and aluminum, creating a joint tariff agreement establishing a free trade zone for these metals between the two countries. The Trump administration stated the agreement would create “$5 billion in opportunity for new exports for US farmers, ranchers, and producers” while still generating $6 billion in revenue through the remaining 10% baseline tariff. Agriculture Secretary Brooke Rollins highlighted the elimination of ethanol tariffs and establishment of a 13,000 metric tonne beef export quota for each country.

The market rally accelerated when Trump struck an optimistic tone on upcoming negotiations with China, suggesting Treasury Secretary Scott Bessent’s talks scheduled for this weekend with Chinese officials would be “very substantive” and noting that current 145% tariffs on Chinese goods “can’t go any higher.” British Prime Minister Keir Starmer, who joined the announcement by phone, described the agreement as “historic” while acknowledging some details still need “ironing out.” The trade framework also eliminates barriers for pharmaceutical trade, with British Ambassador to the US Peter Mandelson noting Trump’s “11th-hour intervention” was key to finalizing terms. The White House fact sheet indicated the deal would “significantly expand US market access in the UK” while maintaining protections for domestic industries.

Financial analysts offered mixed reactions to the scope of the agreement. Jay Hatfield, chief executive at Infrastructure Capital Advisors, called the deal “fairly thin” but “nonetheless a positive development,” while Joe Brusuelas, chief economist for RSM, argued it fails to “provide the clarity necessary to lift the fog of uncertainty created by a trade war of choice.” Trump maintained that the port traffic slowdown affecting West Coast facilities resulting from his tariff policies is “a good thing” as it reduces the US trade deficit, while urging investors to buy stocks, saying, “This country will be like a rocket ship that goes straight up.” Lutnick also teased a forthcoming $10 billion Boeing aircraft purchase by a British airline as Trump administration officials confirmed ongoing bilateral trade negotiations with Japan, South Korea, and India under similar framework agreements.

(CP) WASHINGTON – Reported by Victoria Hayes.