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CNBC
14 hours ago
- Business
- CNBC
CNBC Transcript: U.S. Commerce Secretary Howard Lutnick Speaks with CNBC's 'Squawk on the Street' Today
WHEN: Today, Thursday, July 24, 2025 WHERE: CNBC's "Squawk on the Street" Following is the unofficial transcript of a CNBC interview with U.S. Commerce Secretary Howard Lutnick on CNBC's "Squawk on the Street" (M-F, 9AM-11AM ET) today, Thursday, July 24. Following are links to video on and All references must be sourced to CNBC. CARL QUINTANILLA: The E.U. is scrambling to strike a trade deal ahead of next week's August 1 deadline. FT did report yesterday that a potential deal would impose 15 percent tariffs on European imports, similar to the Japan number that we got this week. Joining us this morning, Commerce Secretary Howard Lutnick. Mr. Secretary, great to have you. I know you've been busy, streets hungry for an update on the E.U. What can you tell us? U.S. COMMERCE SECRETARY HOWARD LUTNICK: Well, the E.U. really, really, really wants to make a deal. I mean, what's happened is Donald Trump sent them a letter and said, look, if we don't make a deal, you've got a huge trade deficit. I mean, $235 billion trade deficit, which means they sell us more stuff than we sell them. And so the president said it's 30 percent if you don't get a deal done. So you know how badly they want to make a deal. QUINTANILLA: Is 15 the new benchmark? LUTNICK: Well, look, the Japan deal, which I'd like to talk about, was amazing. I mean, not only are they paying 15 percent, but they gave Donald Trump and the American people $550 billion, $550 billion to invest at our -- at Donald Trump's discretion, the American people's discretion to build in America the things that Donald Trump wants to build. Power, generic drugs, shipbuilding, whatever Donald Trump wants to build. The Japanese will finance it for him. Pretty amazing. JIM CRAMER: Mr. Secretary, I thought that was an incredible gift. And it had to happen. I am very concerned that if there's no deal with Europe, what they'll do to our service companies. It's the only thing that they ever really do -- take from us anyway. How do we protect these great American companies? LUTNICK: Well, you're right. But they attack our great tech companies every day. They have this DST, Digital Services Act, a Digital Markets Act, also another tax on American technology. And so we're trying to beat that back. And in these trade deals, we talk about it. Look, we think it's reasonable that these companies pay fair tax in Europe. But we've got to stop this onslaught -- of this regulatory onslaught of our tech companies. And Donald Trump's got these tech companies back. And we are working on it. You saw we got rid of it in Canada. We got rid of it in all sorts of countries. They knock it down. That's one of our key objectives. CRAMER: And let's talk about Korea for a second. I don't know what's going to happen if there's no deal before August 1. But I've got to tell you, they have plants in this country. When you look at the plants they just assembled, all the IP is from Korea. How do we get them to be serious about the plants that they have here? LUTNICK: Well, what happens is, when it comes into the country, you put a tariff on it. So if you bring the engine in, you pay the tariff. If you bring the parts in, you pay a tariff. So if you tariff the parts, you capture the idea. And we're all over that. Now, you know, the Korean manufacturers, they do produce plenty of cars here. But as you pointed out, they tend to bring a lot of things in from overseas. That'll get caught by these tariffs. And you know the Koreans also, like the Europeans, they very, very much want to make a deal. And when they saw, I mean, you could hear the expletives out of Korea when they read the Japanese deal. Because the Koreans and the Japanese, they stare at each other. And so you can imagine what they were thinking when they saw that Japan made that deal. They were like, oh, man. And of course, they're going to be in my office today talking. DAVID FABER: Mr. Secretary, you know, when it comes to the Japan deal, the $550 billion in investment, we were trying to grapple with this a bit yesterday. Do we have specifics around where that's coming from, where it's going, what timelines, what metrics, what they're going to be held to? I'm just trying to understand a bit more around what is obviously a very large number. LUTNICK: So the key is, this is not regular foreign investment. This is not Toyota building a plant in America. That's what normally people think about. This is literally the Japanese government itself saying to Donald Trump, we will provide Donald Trump and the American people $550 billion on projects you choose. And we will give you 90 percent of the profits, America. So basically, Donald Trump can pick the projects. And we are working the details out now. We're doing the documentation right now. But here's an example. Donald Trump says, look, we don't make generic antibiotics in America. We don't make antibiotics. So let's go build those factories. Let's go invest $15 billion and let's take care of generic antibiotics. And bam, the Japanese will finance it for us. It doesn't cost us money. And those profits, 90 percent of the profits stay in America. 10 percent go back to the Japanese to pay the cost of funding. And that's it. We don't have any obligation to pay anything other than 90-10 split. So Donald Trump can take care of America and solve it. FABER: And they're under an obligation to actually provide, to provide that financing. I mean, is there a way you're going to measure it if they're in violation? Or, you know, I'm just curious over what time period? LUTNICK: It's easy. This is so easy, right? We give them the project. They pay for the project. They don't pay for the project, their tariff is going to go sky high the next day. They're going to pay for the project. This is easy to execute. FABER: OK, on something else I wanted to come back on, which is TikTok. There was -- there was some reporting yesterday, but I know you did an interview, but I don't think you talked about TikTok. So I'm curious because I know that's also under your aegis. Where are we on that in terms of dealing with the Chinese and whether or not they're actually going to allow the algorithm to be potentially transferred? And we get a buying group here that takes it out of Chinese control. LUTNICK: Right, it's got to come out of Chinese control, right? We've made the decision you can't have Chinese control and have something on 100 million American phones. That's just -- that's just not -- that's just not OK. So if it's in American control and, you know, China can have a little piece or ByteDance, the current owner, can keep a little piece. But basically, Americans will have control. Americans will own the technology and Americans will control the algorithm. That's something Donald Trump is willing to do. If that deal gets approved by the Chinese, then that deal will happen. If they don't approve it, then TikTok is going to go dark. And those decisions are coming very soon. So let's see what the Chinese do. They've got to approve it. The deal is over to them right now. FABER: Is it part of the overall trade talks with China? LUTNICK: Well, yes and no. I would say it's not really part of the trade talks, but you can't really go meet somebody and not bring up the topics that are open. So that's, that's sort of, you know, it's not officially part of it, but unofficially, of course, it's going to be discussed. QUINTANILLA: And finally, Mr. Secretary, on Japan, there were some complaints yesterday from the domestic auto lobby that some cars made by U.S. producers might be facing higher levies than cars built entirely in Japan. Does that -- do they have that right? LUTNICK: That's just, oh my God, that's just so silly. I mean, come on, you know, 15 percent by the Japanese. OK, it's not as good as 25 percent. When your competitor goes from 25 percent against them to 15 percent against them, I guess you're a little bummed out. But come on, there's no tariff if you build it in America, and they're paying 15 percent. I'm telling you, the American manufacturers, I spoke -- I spoke to the CEOs this morning. They are cool with it. They were just, you know, their PR people were just sort of ginning up a little, a little concept that, oh, we're not as happy as we used to be. But the American manufacturers are going to do extremely well in America. As long as they build it in America, you build it in America, you're good. QUINTANILLA: Mr. Secretary, good to talk to you. We'll watch the tape closely and look forward to your return, Commerce Secretary Howard Lutnick.
NBC News
21 hours ago
- Business
- NBC News
China's Xi calls for 'proper handling of frictions' at tense summit with E.U. officials
BEIJING — Chinese President Xi Jinping urged top European Union officials on Thursday to 'properly handle differences and frictions' as he criticized Brussels's recent trade actions against Beijing at a tense summit dominated by concerns on trade and the Ukraine war. Expectations were low for the summit in the Chinese capital marking 50 years of diplomatic ties after weeks of escalating tension and wrangling over its format, with the duration abruptly halved to a single day at Beijing's request. 'The current challenges facing Europe do not come from China,' Xi told visiting European Commission President Ursula von der Leyen and European Council President Antonio Costa, state news agency Xinhua said. He urged the E.U. to 'adhere to open cooperation and properly handle differences and frictions,' after von der Leyen earlier called for a rebalancing of trade ties with the world's second-largest economy, saying relations were at an 'inflection point.' 'Improving competitiveness cannot rely on 'building walls and fortresses,'' Xi added, according to Xinhua. ''Decoupling and breaking chains' will only result in isolation.' 'It is hoped that the European side will keep the trade and investment market open and refrain from using restrictive economic and trade tools,' Xi said. During the meeting in Beijing's Great Hall of the People, von der Leyen told Xi, 'As our cooperation has deepened, so have imbalances,' according to a pool report. 'We have reached an inflection point,' she added, urging China to 'come forward with real solutions.' She was referring to the E.U.'s trade deficit with China, which ballooned to a historic 305.8 billion euros ($360 billion) last year. E.U. trade actions in the past year have targeted Chinese exports of EVs among other goods, and its officials have repeatedly complained about Chinese industrial overcapacity. In a further veiled criticism of Brussels's recent hawkish stance on China, Xi also warned E.U. leaders to 'make correct strategic choices.' The two E.U. officials were set to meet Chinese Premier Li Qiang later. Both sides hope to reach a modest joint statement on climate, now one of the rare bright spots in their cooperation. At the start of President Donald Trump's second term, both sides had more of a consensus in working together to tackle trade challenges from the United States, said Cui Hongjian, a foreign policy professor at Beijing Foreign Studies University. 'Recently the situation has changed,' Cui said. 'The E.U. has continued to compromise with the United States, which means that there is currently a lack of impetus for E.U.-China ties to become closer.' The run-up to the summit saw tit-for-tat trade disputes and hawkish European rhetoric, such as a July 8 accusation by von der Leyen that China was flooding global markets as a result of its overcapacity and 'enabling Russia's war economy.' In a post on X on Thursday, however, von der Leyen struck a more conciliatory tone, describing the summit as an opportunity to 'both advance and rebalance our relationship.' Topics the Europeans are expected to raise in the talks are electric vehicles and China's rare earth export controls that disrupted supply chains worldwide, causing temporary stoppages in European automotive production lines in May. But China's exports of rare earth magnets to the E.U. surged in June by 245% from May, to stand at 1,364 metric tons (1,503 short tons), though that was still 35% lower than the year-earlier figure, customs data showed.
The Hindu
a day ago
- Business
- The Hindu
Rupee rises 17 paise to 86.24 against U.S. dollar in early trade
The rupee appreciated 17 paise to 86.24 against the U.S. dollar in early trade on Thursday (July 24, 2025), tracking the weakness of the American currency in the overseas market. Forex traders said uncertainty over the India-U.S. trade deal has been a huge overhang for the forex market, leaving the rupee trading in a tight range. Moreover, a negative trend in domestic equities and foreign fund outflows dented investors' sentiments and restricted the upmove of the local unit. At the interbank foreign exchange, the domestic unit opened at 86.33 and touched 86.24 against the greenback in initial deals, higher by 17 paise from its previous closing level. On Wednesday (July 23, 2025), the rupee settled with a loss of 3 paise at 86.41 against the dollar. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.06% to 97.15, as investors watched out for a trade deal ahead of the August 1 deadline. Brent crude, the global oil benchmark, went up by 0.25% to $68.68 per barrel in futures trade, on the trade optimism with U.S.-Japan deal done and U.S.-E.U. deal under talks, which could ease pressure on the global economy. However, the uncertainty over U.S.-China trade talks and Eluding peace between Russia and Ukraine is limiting further gains, said Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP. Mr. Bhansali further noted that despite a fall in Dollar index and rise in risk assets, Indian rupee has not been able to show any substantial gains largely due to significant dollar demand in the system. The rupee will remain in a range of 86.10 to 86.60, Mr. Bhansali said, adding that "We need to wait and watch the developments that are happening particularly on the deal front." If the discussions fail or get delayed, Indian exporters could face fresh pressure — adding to the rupee's challenges. However, if a deal is reached, it could offer a much-needed breather. Until then, the uncertainty is likely to keep market participants cautious. Meanwhile, in the domestic equity market, Sensex declined 124.79 points or 0.15% to 82,601.85, while Nifty fell 15.75 points or 0.06% to 25,204.15. Foreign institutional investors (FIIs) offloaded equities worth ₹4,209.11 crore on a net basis on Wednesday, according to exchange data.
Yahoo
7 days ago
- Business
- Yahoo
Trump's tariffs are tipping Europe toward recession
Trump's tariff threats—potentially up to 30% on E.U. imports—may tip Europe into recession by late 2025, some analysts say. European exporters are heavily reliant on the U.S. market, especially in autos and pharmaceuticals. The U.S. is the largest trading market for both the E.U. and the U.K. Stock markets remain buoyant for now, seemingly on the assumption that deals will be struck lowering the rates. U.S. Federal Reserve Governor Christopher Waller said yesterday that he thinks the Fed should cut interest rates at the end of July because he thinks the U.S. economy's 'momentum has slowed significantly,' and he's worried about unemployment rising. He's not alone. Oxford Economics' Ryan Sweet told clients this week that President Trump's tariffs will shave growth off the U.S. economy. 'The hit to US GDP growth is 0.1ppt this year and 0.3ppts next year,' he wrote in a note seen by Fortune. While the tariffs' effects on the Fed rate and the U.S. economy have generated most of the headlines recently, they are having a serious negative effect on the European economy too. Trump has threatened to impose a 30% tariff on that trade if the parties don't strike a better deal. Analysts are saying that if no deal is reached, the tariff barrier could push Europe into a recession. 'A 30% US tariff on EU exports would send the EZ economy into recession in the second half of 2025,' Pantheon Macroeconomics' Claus Vistesen said in a recent research note. 'Markets don't believe Mr. Trump's tariff threats, but a US-EU escalation cycle is still a big near-term risk. The ECB will hold fire [on retaliating] in July unless it is absolutely certain a 30% tariff is coming over the summer.' 'A sustained 30% US tariff … would pull down our 2025 and 2026 growth forecasts by 0.3pp and 0.5pp, respectively, to 0.7% and 0.8%,' he said. At Oxford Economics, Angel Talavera agrees: 'We estimate the US tariffs of 30% on imports from the EU threatened by President Trump could shave up to 0.3ppts off annual Eurozone growth over the next two years. This would push the Eurozone economy to the edge of recession, with growth stagnating over the coming quarters,' he wrote in a recent note. Unemployment in the U.K. is already on the rise—it ticked up to 4.7% over the last three months, the highest in four years. The problem is that the U.S. is Europe and Britain's largest export market. About 20% of EU exports go to the U.S. at a value of around €500 billion ($581 billion). Europe's trade doesn't immediately have anywhere else to go—at least not at that scale. 'The sheer size of the US economy means that it takes a large share of Europe's exports, particularly pharmaceuticals and autos. This will make it difficult for Europe to switch to other markets,' Oxford Economics' Matt Swannell said in a note this week. It's not just the size of Trump's tariff demand, it's the complexity. 'On top, there are sectoral tariffs of 25% on cars/parts, as well as 50% on aluminum and steel (up from 25% since June 4). Effective tariffs rates could remain at 12-17% (assuming a 10-20% universal tariff), which is significantly higher than the around 1% at the start of the year with automotives, steel and potentially pharma hit by sectoral tariffs,' Deutsche Bank's Marion Muehlberger and Ursula Walther told clients this week. Pharmaceuticals are one of the biggest export markets for Europe, and Trump has threatened to tax them at a rate of 200% on entry to the U.S. Finally, there's the ever-changing nature of Trump's demands. Until a few weeks ago, a 30% tariff wasn't even on the radar. 'In June, the ECB's baseline scenario assumed just a 10% tariff, and even the downside scenario only went up to 20%. A 30% tariff would be more damaging to the eurozone economy, even if European retaliation eventually pushed inflation higher,' ING's Carsten Brzeski said in a research note this week. European stock markets are whistling past this graveyard at the moment. The Stoxx Europe 600 and the UK's FTSE 100 are both at or near all-time highs. France's CAC 40 is up 6% YTD and Germany's DAX blue chip index is up a staggering 21.69% YTD, based largely on Germany's big fiscal military spending plan. Here's a snapshot of the action prior to the opening bell in New York: S&P 500 futures were flat this morning, premarket. The index closed up 0.54% yesterday. STOXX Europe 600 was up 0.4% in early trading. The UK's FTSE 100 was up 0.32% this morning, placing it above 9,000, which would be an all-time high if it holds. China's CSI 300 was up 0.6%. Japan's Nikkei 225 was down 0.21%. Bitcoin is still above $118K. This story was originally featured on Sign in to access your portfolio
New York Times
16-07-2025
- Business
- New York Times
Europe Rushes to Negotiate a Trade Deal as Trump's Team Voices Indifference
Maros Sefcovic, one of the European Union's top trade negotiators, is headed to Washington on Wednesday to talk to Trump administration officials in a bid to stop painful 30 percent tariffs from kicking in on Aug. 1. But at a time when E.U. officials are hoping that President Trump's latest tariff threat is more of a negotiating gambit than a serious possibility, the latest comments from the White House have offered little encouragement. Mr. Trump is 'indifferent whether we take in the 30 percent rate or whether the Europeans come to us with a much better deal,' Scott Bessent, the Treasury secretary, said on Bloomberg Television on Tuesday, later calling this moment a 'generational opportunity to reset trade.' Mr. Trump told reporters outside the White House on Tuesday that 'we already have a deal with the E.U.,' referring to the letter he sent last week to Ursula von der Leyen, president of the European Commission, threatening to increase across-the-board tariffs. That is the backdrop of the latest visit by Mr. Sefcovic, the European Union trade commissioner. He is expected to meet separately with Howard Lutnick, the commerce secretary, and Jamieson Greer, the U.S. trade representative, said Olof Gill, a spokesman for the European Commission, the European Union's executive arm. Mr. Sefcovic has flown to Washington repeatedly in recent months, and has spoken by phone with Mr. Greer and Mr. Lutnick already this week. He and other European trade negotiators had thought until last week that their constant contact with the Trump administration was about to yield results and that they were close to striking a deal. The agreement was widely expected to include a 10 percent across-the-board tariff rate, while securing exceptions for key products. Instead, they received Mr. Trump's letter on July 11 threatening to boost levies to a level that European policymakers have warned would be devastating for the trans-Atlantic trading relationship. It is not clear what Europe could offer the United States that it has not already put forward. The bloc was willing to accept higher tariffs, to buy more American energy and to invest more in American technology, among other concessions. But it has refused to bend to some Trump administration demands, including changing how it regulates large technology companies and online speech. 'I don't think there's this magic' solution, said Jörn Fleck, a senior director with the Europe Center at the Atlantic Council, a think tank. 'I think it's in the Trump administration's hands.' The European Union has been drawing up plans to retaliate if negotiations fail by hitting a wide array of American imports with tariffs. When asked on Tuesday about those plans, Mr. Trump said simply that 'I don't know how they can retaliate.' 'They've treated us very badly, but now they're treating us very nicely,' he added. 'I think everybody's going to be happy with the E.U.'
