Finance
Reeves says UK favours de-escalation on US tariffs
Published by Global Banking & Finance Review®
Posted on January 21, 2026
2 min readLast updated: January 21, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on January 21, 2026
2 min readLast updated: January 21, 2026
Rachel Reeves is confident the UK-US economic deal will remain stable despite geopolitical tensions, citing ongoing diplomatic efforts.
Jan 21 (Reuters) - Britain wants to de-escalate trade tensions with the United States, finance minister Rachel Reeves said on Wednesday, after President Donald Trump threatened to punish European countries for opposing his push to acquire Greenland.
Like other countries, Britain is grappling with a shift in tone from Washington towards its historical allies.
"We would never rule anything out. But the advantage for Britain comes from reducing barriers to trade, because that helps British businesses," Reeves told BBC News on the sidelines of the World Economic Forum meeting in Davos.
Trump has said he would next month impose an additional 10% tariff on European countries, including Britain, for their opposition to his plans to take control of Greenland, an autonomous territory of Denmark.
European Union leaders were set to discuss on Thursday the possibility of a retaliatory package of tariffs on 93 billion euros of U.S. imports from next month.
REEVES CONFIDENT TRADE DEAL WITH US WILL ENDURE
Reeves stressed the value of diplomacy and economic ties.
She said she was confident the economic deal signed with Washington last year would endure, citing remarks from U.S. Commerce Secretary Howard Lutnick that there was no reason why trade deals should be undone.
"I'm confident that our diplomacy, the work that we are doing will mean that we can stick with that deal that we secured with the U.S. last year," Reeves told Channel 4 News.
The United States and Britain announced a deal last year to lower tariffs on some goods, with U.S. levies on cars being cut and both sides gaining better access to agriculture markets.
"We will work always with our businesses and in the interests of working people in Britain to bring barriers down, not to up the rhetoric to get a cheap headline," Reeves said.
The issue of Greenland would be resolved through diplomacy rather than antagonism and Britain would be a key player, she said.
Separately on Wednesday, British Prime Minister Keir Starmer said he would not yield to Trump on Greenland, adding that the U.S. president had reversed his prior support for a Chagos Islands deal to put pressure on Britain.
(Reporting by Andy Bruce; editing by Suban Abdulla and Alex Richardson)
Financial stability refers to a condition where the financial system operates effectively, with institutions able to withstand economic shocks and continue to provide essential services.
The UK economy encompasses the economic activities and financial systems of the United Kingdom, including production, consumption, and trade.
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