Sir Keir Starmer has admitted that "clearly, there will be an economic impact" from Donald Trump's tariffs. But the Prime Minister insisted the Government would respond with "cool and calm heads".

Mr Trump has slapped a 10% levy on US imports of UK goods as he confirmed sweeping taxes on countries across the world. The PM told business chiefs in Downing Street: "Last night the President of the United States acted for his country, and that is his mandate. Today, I will act in Britain's interests with mine."

Sir Keir said as the Government moved "to the next stage of our plan", the "decisions we take in coming days and weeks will be guided only by our national interest, in the interests of our economy, in the interests of businesses around this table, in the interests of putting money in the pockets of working people".

He said: "Nothing else will guide me, that is my focus.

"Clearly, there will be an economic impact from the decisions the US has taken, both here and globally.

"But I want to be crystal clear: we are prepared, indeed one of the great strengths of this nation is our ability to keep a cool head."

It comes as the UK had been scrambling to secure an economic deal with the US in a bid to mitigate tariffs.

The levies are a blow to Labour as they risk derailing Chancellor Rachel Reeves's attempts to balance the books.

Business Secretary Jonathan Reynolds said tariffs on the UK are a "disappointment" and "a challenge".

But he told Times Radio that Britain is in a "better position than a lot of other countries from what was announced last night, but I was still disappointed."