US president Donald Trump’s deadline on the imposition of reciprocal tariffs announced on his so-called “liberation day”, which was due to expire this week, has been extended to 1 August.

Trump, who has been writing letters to global leaders outlining the extra levies which will have to be paid on exports to the US after that date, said the extension was based on “information on the status of discussion with trading partners”.

The most significant of those discussions is the one with the EU. Tánaiste Simon Harris said on Monday evening that the extension of the deadline would “give further time for the EU and US to reach an agreement in principle”.

As was seen with the UK-US trade deal which was announced in mid-May, the scope of any agreement with the EU may be fairly limited, covering only the main issues with broad strokes.

However, even that would be seen as positive as it would then be clear what the general level of tariffs on EU exports to the US would be – current expectations are for a 10% rate on everything – and whether there would be any relief from the additional duties levelled on car and industrial metal exports.

Food

Thankfully, the threat of an additional 17% levy on EU food and drink imported into the US which emerged last week seem to have been taken off the table.

For the EU, there are risks that the bloc could be forced into a position where negotiators would have to choose between a deal which gives trade advantages to the US, or having to face further punitive tariffs from the Trump administration.

Still volatility

Even if there is a deal agreed ahead of the new deadline, there is also the risk that there would be further U-turns from Washington DC.

Trump has repeatedly made it clear that he is willing to quickly impose new measures against any country or bloc which has done something to cause him offence.

This week, he said that countries embracing the “anti-American policies” of the Brics group of countries, which includes Brazil, India and China, would be subject to an additional 10% tariff.

He did not expand on what he saw as those anti-American policies.

Meanwhile, the disruption to global trade seen since liberation day continues.

Latest data from Germany, where trade with the US is skewed towards vehicles and heavy industry showed that exports to the country dropped by 7.7% in May compared to the previous month, and were 13.8% lower than May 2024. The total value of German exports to the US in May at €12.1bn was the lowest value since March 2022.

Irish export data for May will be published next week, and that is expected to show a similar pattern.

The huge surge in exports in the months leading up to the announcement of the imposition of tariffs means that there are likely to be significant stocks of goods in the US, so no matter what happens over the coming weeks, there is unlikely to be a resurgence in US demand in the short term.