Donald Trump has announced he will impose a 30% tariff on imports from the European Union from 1 August.
The tariffs could make everything from French cheese and Italian leather goods to German electronics and Spanish pharmaceuticals more expensive in the US.
Mr Trump has also imposed a 30% tariff on goods from Mexico, according to a post from his Truth Social account.
Announcing the moves in separate letters posted on his account, the president said the US trade deficit was a national security threat.
In his letter to the EU, he wrote: "We have had years to discuss our trading relationship with The European Union, and we have concluded we must move away from these long-term, large, and persistent, trade Deficits, engendered by your tariff, and non-Tariff, policies, and trade barriers.
"Our relationship has been, unfortunately, far from reciprocal."
In his letter to Mexico, Mr Trump said he did not think the country had done enough to stop the US from turning into a "narco-trafficking playground".
The president of the European Commission, Ursula von der Leyen, said the EU could adopt "proportionate countermeasures" if the US proceeds with imposing the 30% tariff.
Ms von der Leyen, who heads the EU's executive arm, said in a statement that the bloc remained ready "to continue working towards an agreement by Aug 1".
"Few economies in the world match the European Union's level of openness and adherence to fair trading practices," she added.
"We will take all necessary steps to safeguard EU interests, including the adoption of proportionate countermeasures if required."
'Very concerning'
Ms von der Leyen has also said imposing tariffs on EU exports would "disrupt essential transatlantic supply chains".
Meanwhile, Dutch Prime Minister Dick Schoof said on the X social media platform that Mr Trump's announcement was "very concerning and not the way forward".
He added: "The European Commission can count on our full support. As the EU we must remain united and resolute in pursuing an outcome with the United States that is mutually beneficial."
Mexico's economy ministry said a bilateral working group aims to reach an alternative to the 30% US tariffs before they are due to take effect.
The country was informed by the US that it would receive a letter about the tariffs, the ministry's statement said, adding that Mexico was negotiating.
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Trump's tariff threats and delays
On his so-called "liberation day" in April, Mr Trump unleashed "reciprocal tariffs" on many of America's trade partners.
The US president said he was targeting countries with which America had a trade imbalance.
However, since then he has backed down in a spiralling tit-for-tat tariff face-off with China, and struck a deal with the UK.
The US imposed a 20% tariff on imported goods from the EU in April but it was later paused and the bloc has since been paying a baseline tariff of 10% on goods it exports to the US.
In May, while the US and EU where holding trade negotiations, Mr Trump threated to impose a 50% tariff on the bloc as talks didn't progress as he would have liked.
However, he later announced he was delaying the imposition of that tariff while negotiations over a trade deal took place.
Earlier this week, the EU's executive commission, which handles trade issues for the bloc's 27-member nations, said its leaders were still hoping to strike a trade deal with the Trump administration.
Without one, the EU said it was prepared to retaliate with tariffs on hundreds of American products, ranging from beef and auto parts to beer and Boeing aeroplanes.
(c) Sky News 2025: Donald Trump announces 30% tariff on imports from EU