Ministers race to sign trade deal in shadow of Trump's tariff threat

Ministers firmly believe Britain will be hit by more tariffs when Donald Trump announces his latest round of trade barriers on Wednesday as part of what the US president is calling "liberation day".

- Kiran Stacey

Senior members of the government have been engaged in intense negotiations over recent weeks as they have raced to agree a trade deal with the US to avoid the UK being in the package of measures.

The stakes are high for the government, with forecasters warning that a 20 percentage point increase on tariffs on UK goods and services would cut the size of the British economy by 1% and force the chancellor, Rachel Reeves, into tax rises this autumn.

Officials now fear, however, they will not have agreed a deal in time, sources have told the Guardian, and are resigned to being hit by whatever Trump announces on 2 April.

Ministers will continue talks after that date, hoping they can avoid a damaging hit to UK economic growth by agreeing a deal to reduce tariffs once they have already been promised.

One Whitehall official said: "We have been working hard behind the scenes for a while on an economic deal, and that work continues. But we don't see Wednesday as a hard and fast deadline."