United States to slap tariffs on steel, aluminium from European Union on Thursday

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President Donald Trump imposed a 25 per cent tariff on steel imports and a 10 per cent tariff on aluminium in March, but granted temporary exemptions to the European Union and five other countries.

"The EU, Canada, and Mexico make up about half of U.S. steel imports, so the economic effect of these tariffs would be far more than anything we've seen to date", he said.

It also sent a chill through financial markets, with the Dow Jones Industrial Average .DJI down around 0.5 percent.

Our North American allies have been engaged in (what they had believed to be) earnest, productive discussions with the USA on reforming NAFTA, and had thus assumed that Washington would not unilaterally impose tariffs on them - let alone that it would so without providing any warning.

Earrlier in the day, Ross announced that Washington will start to impose a 25-percent tariff on steel imports and a 10-percent tariff on aluminum imports on the EU, Canada and Mexico at midnight tonight.

The United States' tariff announcement ends a two-month exemption for its southern neighbor and comes amid continued uncertainty about the future of the North American Free Trade Agreement (NAFTA). Therefore, as of June 1, 2018, tariffs will no longer be suspended for steel or aluminum imports from those countries.

The head of the Canadian Chamber of Commerce called on Canada to retaliate against the US move.

The US announced steel and aluminum tariffs this morning.

Germany's foreign minister Heiko Mass called the tariff decision unlawful.

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In imposing the tariffs, President Donald Trump invoked a seldom-used section of a 1960s trade law that allows him to erect trade barriers when imports imperil national security. Boeing and Caterpillar were losing 1.1 and 1.2 percent, respectively.

"Bad news that @POTUS has chose to impose taxes on American consumers buying steel and aluminum from our closest allies -Canada, the European Union, and Mexico (with whom we run a trade surplus on steel)", tweeted Sen.

The U.S. Beer Institute says its members, which includes Denver and Montreal-based Molson Coors Brewing Co., are united against the tariffs on imported aluminum.

The Trump administration has given permanent metals tariff exemptions to several countries including Australia, Argentina and South Korea, but in each case set import quotas. In his public comments on the tariffs, however, the president rarely references this rationale, focusing instead on an economic argument for taking radical measures to reduce America's trade deficit. Shares of BMW (BMWG.DE), Daimler (DAIGn.DE) and Volkswagen (VOWG_p.DE) fell.

"We will consider whatever actions they do take but our focus is as mentioned on national security aspects of steel and aluminum", he said.

"The Section 232 steel and aluminum tariffs have already had major, positive effects on steel and aluminum workers and jobs and will continue to do so long into the future".

"Global trade is not a gunfight at the OK Corral", France's finance minister quipped after meeting U.S. Commerce Secretary Wilbur Ross.

Europe did not want a trade war, he said, but Washington had to back down from "unjustified, unjustifiable and unsafe tariffs".

Mexico struck back swiftly after the United States announced today that it would impose tariffs on Mexican metal imports.