The United States and the European Union have reached a preliminary trade deal to avoid a 30% U.S. tariff on imported goods from the EU that President Donald Trump threatened would go into effect on Aug.

The European Union and its 27 member nation bloc became the latest of the United States' top trading partners to come to an agreement with Trump over the weekend, joining the Philippines, Japan and Indonesia in announcing deals during July.

The rate will apply in addition to individual “reciprocal” tariffs targeting countries with which the US runs a trade deficit.

Trump had most recently threatened tariffs of 30% on imports from the European Union. But on Sunday, he met with the president of the European Commission, and they agreed to a lower level.

Inflation is creeping back into the US economy and might get a lot worse in the near future, thanks to President Trump's tariffs.

The EU, a group of countries with shared economic interests, exports about $2 trillion worth of goods to the U.S. The 27 countries had hoped for a lower tariff of 10%, similar to the deal Trump negotiated with the U.K. and well below the original threat of 30% tariffs, but most analysts expected something closer to 15%.

By David Lawder, Greta Rosen Fondahn and Maria Martinez STOCKHOLM (Reuters) -U.S. and Chinese officials agreed to seek an extension of their 90-day tariff truce on Tuesday, following two days of what both sides described as constructive talks in Stockholm aimed at defusing an escalating trade war between the world's two biggest economies that threatens global growth.

"We're in much better shape because it's now clear that if there's gonna be a real trade war with anyone, it would just be with China," Secretary Ross tells Fortune.