Trade Representative Robert Lighthizer told a Senate panel that Mr Trump had decided to "pause" the import duties while further discussions took place.

The tariffs of 25% on steel and 10% on aluminium are due to come into effect on Friday.

The EU had argued it should be exempt.

Aside from the EU Mr Lighthizer said Argentina, Australia, Brazil, Canada, Mexico and South Korea would be exempted.

"The idea that the president has is that, based on a certain set of criteria, that some countries should get out," he told the Senate committee hearing.

"There are countries with whom we're negotiating and the question becomes the obvious one that you think, as a matter of business, how does this work?

"So what he has decided to do is to pause the imposition of the tariffs with respect to those countries."

Earlier this month, the EU's trade commissioner said the bloc would "stand up to the bullies" over protectionism.

Cecilia Malmström said protectionism was being "used as a weapon to threaten and intimidate us".

Analysis: By Kim Gittleson, New York business correspondent

In announcing exemptions for the European Union, Argentina, Australia, South Korea and Brazil, the Trump administration has effectively narrowed the countries that it is targeting with its protectionist trade policies. It also blunts the potential fallout to the US economy from the implementation of these trade barriers.

It pays to do some maths.

US imports of steel last year totalled $33bn.

But if the countries granted exemptions are removed from that total - including Canada and Mexico, whose exemptions had already been announced - then less than a third of US steel imports would be subject to tariffs.

This significantly lowers the potential economic impact of the tariffs - as well as the potential help it might provide to domestic steel industry here in the United States.

And it suggests that in steel tariffs, as with many policy actions the White House has taken, the reality of what is being done falls slightly short of the rhetoric.

Gareth Stace, a director with the trade association UK Steel, said the temporary exemption from tariffs would be "greeted with an enormous sigh of relief" by the UK's steel sector.

"It now provides us with the breathing room to find a more permanent solution.

"The alternative would be a severe curtailment of our ability to export to the US. With some 350,000 tonnes of steel sold to the US last year, 7% of our total exports, it is clear any tariffs would ultimately hit the sector hard," he added.

A UK government spokesperson said they welcomed the "signals" that the US government was considering EU wide exemptions for limited time period.

"The government will continue to work closely with the EU and the US Administration for a full exemption, and to ensure UK companies are not negatively impacted, either directly or indirectly.

"We remain concerned about the impact of these tariffs on global trade and will continue to work with the EU on a multilateral solution to the global problem of overcapacity, as well as to manage the impact on domestic markets."