CNBC Transcript: U.S. Commerce Secretary Howard Lutnick Speaks with CNBC’s “Power Lunch” Today

WHEN: Today, Tuesday, July 8, 2025

WHERE: CNBC's "Power Lunch"

Following is the unofficial transcript of a CNBC interview with U.S. Commerce Secretary Howard Lutnick on CNBC's "Power Lunch" (M-F, 2PM-3PM ET) today, Tuesday, July 8. Following are links to video on CNBC.com: https://global-deals.online/video/2025/07/08/howard-lutnick-trump-may-cut-tariff-rates-with-a-few-other-countries.html%3C/a%3E and https://global-deals.online/video/2025/07/08/bessent-greer-and-lutnick-may-meet-with-china-on-trade-in-early-august.html%3C/a%3E.%3C/p%3E%3Cp%3E%3Cstrong%3EAll references must be sourced to CNBC.

DOMINIC CHU:  President Trump's Cabinet meeting just ending moments ago. Tariffs were obviously a very key topic of conversation. So, joining us now is Commerce Secretary Howard Lutnick, who just came from that meeting. Secretary, Mr. Secretary, thank you so much for taking the time to join us. We saw a lot of the conversation that happened within that room, but we want to hear for the record from you, the commerce secretary, about just where you think we are with regard to trade negotiations as a whole as we approach that previously stated July 9 deadline for tariff deals.

U.S. COMMERCE SECRETARY HOWARD LUTNICK:  So, you saw 14 letters went out yesterday. You should expect another anywhere from 15 to 20 letters to go out over the next two days, really setting down tariff lines for the key, driving countries. And then we will set out a general letter to the balance, sort of setting out where they're going to be. The president is setting these tariff lines. The president is driving this agenda. This is his agenda. He knows how he wants to play it. And that's what's happening. So we will be setting those tariff rates, and then they go into effect on August 1.

CHU:  Secretary, Mr. Secretary, the president may be driving the entire negotiation and conversation, but that doesn't mean that folks like you and Treasury Secretary Scott Bessent aren't out there trying to execute the plans, along with U.S. Trade Representative Jamieson Greer. What do you get as a sense for how these negotiations are going with these multiple parties? Do we feel as though there's going to be a more long, drawn-out, contentious conversation, or do we feel like we're in the seven, eighth, or even ninth inning with many of these major counterparties?

LUTNICK: Oh, we're definitely in the eighth or ninth inning with these counterparties. So what's happened is, many of these countries have made us offers to finally open their markets. You know, they just -- they go slowly, they go with it, and then, finally, they come to the table at the very end, and they start to open their market. And the key is, the president wants to balance our trade deficit with the fact that these countries are finally, finally opening their market. And if you have something like Vietnam where they say, OK, we will really open, open our markets, then the president decides, OK, this is the rate we will do. If you're really going to open your market to our farmers, to our fishermen, to our machines, to our tools, to all of these things going into their country, then, OK, if you're going to give our people that opportunity, I'm willing to cut that rate, which he did with -- obviously, he did it with the U.K. He's done it with Vietnam. My guess is, he will do it with a few other countries. But, basically, if they don't really open their market and they come with these half-baked or a little bit here and a little bit there, the president is saying, look, we have got these huge trade deficits. It's time for you to pay the tariff to trade with the United States of America. Unless you're really going to open, that's how it's going to be.

KELLY EVANS: It's Kelly, Mr. Secretary. And I snapped to attention when I heard the president saying 50 percent tariffs on copper, 200 percent potentially on pharmaceuticals. As we understand it, those -- so, the Commerce Department looks through all those sectors, right, and then make your recommendation. How close to final would you say the recommendations in those two sectors are at this point for 50 percent and potentially 200 percent?

LUTNICK:  So, copper is finished. We have done with our study. We have handed the study over to the president. The president knows that he has the ability, since we have studied the market of copper, to set the market tariff for copper. He announced it today at the Cabinet meeting that he intends to go to 50 percent, which will be similar to steel and aluminum, which are both 50 percent, so copper will be 50 percent. And the idea is to bring copper home, bring copper production home, bring the ability to make copper, which is key to the industrial sector, back home to America. We need that kind of production in America. It's important. So that will be out today. You will see the president will TRUTH about it this afternoon, will sign a proclamation, as that goes through the ordinary legal process, within a day or two days. That will come out, but then copper will be set, likely to be put into place the end of July, maybe August 1. So that's copper. With pharmaceuticals and semiconductors, those studies are being completed at the end of the month. And so the president will then set his policies then. And I'm going to let him wait to decide how he's going to do it. He said, if you don't build in America, they're going to be a high rate. But he may consider that if you're building in America to give you the time to build. I think he mentioned that in the Cabinet meeting. Give you time to build, say a year, year-and-a-half, possibly even two years of building, and then the tariff will be much higher. But that – those details will come at the end of the month, and the president will set them.

EVANS: Got it. Thank you. Thank you for the clarity on all of those fronts. Obviously, our audience is closely tuned into what's going to happen there. Also, on the case of China, I remember, when you talked to Brian Sullivan a little while ago, you said, look, like, that's squarely your kind of purview, your remit, figuring out that trade relationship. I'm left a little bit confused as to whether we have reached a trade deal or not. I think the president made some remarks in that direction in the past couple of weeks, but it was unclear what ended up happening. So with rare earths as well, there still seems to be a little bit of confusion on whether those rare earth magnets are coming in, in kind of decent amounts and everything there. Can you just bring us up to speed? What is the trade situation? And is that an open or closed negotiation at this point?

LUTNICK: OK, so we are settled with a 30 percent increased tariff. And then, during President Trump's first term, he had a 25 percent tariff. So, on much of China, they're paying 55 percent. And, on the balance, they're paying 30 percent. And that's where we have settled things for the time being. Now, they have agreed to approve our licenses on rare earth magnets. And, to their credit, they have been doing it swiftly and expeditiously. We decided we were satisfied with the movement that they were making. And so we took down our countermeasures. We started shipping ethane and software products to them and airplane parts and things like, that we're sort of balancing our relationship between the two of us. But we're in a pretty good place now. I think we're going to meet in early August and we're going to start kicking off a bigger trade conversation between the two largest economies in the world, China and the United States of America. So that's going to be kicked off in early August with myself, Secretary Bessent and Ambassador Greer. We will all be going together. We will be meeting our counterparts from China. And we will have a bigger -- start the process of a bigger conversation. I think that's going to take some time. But at least we're beginning the process of having a bigger conversation.

CHU: There's also -- there's also, Mr. Secretary, more of a conversation now built around the European Union. Our own Silvia Amaro out in Europe was speaking to some of the top diplomats out there. And she had made at least reference to this idea that they are saying progress is being made, that there is -- there's still a ways to go, but that there might actually be carve-outs or certain concessions there as you work towards an overarching trade deal with the European Union. Can you take us through how you feel those negotiations are going right now? It is a massively significant trade relationship. We're talking not just about beverage, alcohol and airplane and auto parts, but also many different goods that go between our countries and the bloc over there across the Atlantic.

LUTNICK: So, Europe is our biggest trading partner, and we have a $235 billion trade deficit, meaning they sell us more than we sell them. And that's because they block us on cars and they block us -- they don't pay for pharmaceuticals. All those topics, we need to settle. And it wasn't going anywhere for a while. The president then put out a TRUTH that said, look, if you're not going anywhere, you can pay us 50 percent. Their leaders called President Trump and said, no, no, no, no, no, we will get down to brass tacks and do it. And then they started making us real offers. The European Union, to their credit, has now made significant, real offers, meaning we're going to take down our barriers, we're going to open our markets to American farmers, ranchers, fishermen, really open their markets, and let Americans, finally American entrepreneurial spirit finally get to sell to Europe. The president's got those deals on his desk and he's thinking about how he wants to play them. And this is very tricky, because they have a huge trade deficit. So they have got to pay, but they're really going to bat, trying to say, look, we want to open our markets to you. We want to create a more balanced and fair relationship. Please, Mr. President, think about it. And that's what's on his desk right now. And that's really, really tricky, but he's thinking about it.

EVANS: Lastly, we have had a couple of people point out, as we put these tariff levels back on, should the markets be reacting the way they were on April 2? And maybe there will be a delayed reaction or maybe it's -- you know what I'm saying? Can you kind of wear a little bit of both of your hats here both as a market maker and also as somebody working on optimal policy theoretically? Do you expect any more weakness as we churn through the effect of what these higher tariffs now will be? And it's odd that we had a huge panic a couple months ago, and now we seem to be taking this in stride.

LUTNICK: Well, I think the markets should be taking it in stride, because, remember, there was all that fear that, if you set tariffs, there would be inflation, which there obviously is not inflation. There would be -- this would happen. And, obviously, none of those things happened. You have the whole world paying 10 percent now, and China paying 30 percent additional, and what's happened to the world? Stock market reaching new highs, America taking in more than $30 billion a month in revenues. So the world's gotten comfortable with the fact that Donald Trump knows what he's doing and he's out to make a better deal for America than these horrible trade deals of the past. So that's where we are. I think what you will see is these countries come and open their markets to President Trump and say, will you make us a better deal if we open our market? The president's going to go country by country, decide. Even when he sets the letter, you have seen in the letter, he said, if you change the way you treat America, we will listen and we will think about it.

EVANS: Right.

LUTNICK: I think what you're going to see is, rates will be a little lower than they were on April 2 because these countries are opening their markets, and then some countries will come forward with such good deals that they will literally change their rate. But that's what we're doing every day. We're talking about the offers. We had piles of offers in his office on Monday, piles of offers, saying, what do you think of this offer? What do you think of that offer? What do you think of this offer? And the president's deciding what the rate is because he's called it dead right up until now. And I think he's got the bull by the horns. And America's going to be so much better off, hundreds and hundreds of billions of dollars better off, per year.

EVANS: Right.

LUTNICK: So, if you wanted to bet on anything, you would bet on President Trump and you would bet on America.

EVANS: And we will see if the market continues to agree with that as we get closer to August 1 and beyond. Secretary Lutnick, thanks for making the time and joining us after that meeting today. We appreciate it.

LUTNICK: My pleasure. Good to see you