EU leaders will looking to avoid a full-blown confrontation over trade with the Trump administration today, as efforts continue to broker an EU exemption from looming US steel and aluminium tariffs, EU sources said.

The leaders are expected to try to calm tensions over the introductions of 25pc steel and 10pc aluminium tariffs which will come into force on Friday morning, just as leaders gather in Brussels.

After a succession of high-level EU trips to Washington, there remain hopes that Mr Trump can be persuaded to grant the EU an exemption to the tariffs, sources said, while warning of a potentially “explosive” 48 hours.

EU Trade Commissioner Cecilia Malmström was due back in Brussels last night to report to EU leaders on progress.

One EU source said that Germany believed it was close to securing an exemption to the Section 232 steel and aluminium tariffs, but was still waiting for a final sign-off by the President himself.

In the meantime, Angela Merkel, the German chancellor, continued to warn Washington that the European Union was ready to take countermeasures if necessary, with tariffs lined up on everything from Kentucky bourbon to Harley Davidson motorcycles.

"We consider these tariffs unlawful," Mrs Merkel told German MPs, adding that Germany was convinced that isolationism would hurt everyone in the end.

Senior EU sources said that it was imperative to lower the tensions over trade, and that the EU as the world’s biggest trading bloc, should be “more responsible and reasonable than our US partners”.

This may prove difficult if Mr Trump, as expected, further raises temperatures as early as today by hitting China with $60bn (£42bn) in new tariffs by targeting technology, telecommunications and intellectual property, using section 301 of the 1974 US Trade Act.

EU trade sources said that the new Trump measures were aimed at hitting China over its persistent use of cyber-spying in order to steal US intellectual property, a practice which the US has warned is state-sponsored and state-subsidised.

Overview | Free trade versus protectionism

Sources said there were growing fears that the unspoken price of a US exemption from steel and aluminium tariffs would be a show of support from the EU and Japan for Mr Trump over his battle with China on industrial spying.

“The US wants a show of solidarity,” an EU source with knowledge of the US-EU talks said, warning of the risk that Europe might take a short-sighted approach that deepened but did not resolve rising trade antagonisms with China and was not WTO-compliant.

China has already warned it will retaliate if the Trump administration goes ahead with the Section 301 measures. "China does not want to fight a trade war with anyone. But if anyone forces us to fight one, we will neither be scared nor hide," said a Chinese foreign ministry spokeswoman.