The US has said it will hold off an a threatened hike in tariffs on $7.5bn (£5.75bn) worth of European and UK goods that it imposed as punishment for subsidies for plane-maker Airbus.
The move comes as the two sides wrestle to put to an end their 16-year trade battle over state aid for Airbus and American rival Boeing.
The US last year raised border taxes on more than 100 items, including jumpers, single-malt whiskies and cheese.
It has said the EU has not done enough.
“The EU and member states have not taken the actions necessary to come into compliance with WTO decisions,” America’s top trade official, Robert Lighthizer, said on Wednesday. “The United States, however, is committed to obtaining a long-term resolution to this dispute.
The European Union cautiously welcomed the US decision not to increase the amount of goods subject to tariffs.
“The Commission acknowledges the decision of the US not to exacerbate the ongoing aircraft dispute by increasing tariffs on European products,” an EU spokesperson said.
Airbus last month saidit would alter some deals responsible for the dispute, saying the changes, including increasing its interest rates on loans with France and Spain, eliminated “any justification” for the US border taxes.
The move prompted EU officials to call for an end to “unjustified” tariffs. Many American businesses have also protested the duties, which raise prices for American buyers.
On Wednesday Airbus spokesman Clay McConnell said in a statement the company “profoundly regrets that, despite Europe’s recent actions to achieve full compliance, USTR [U