President Trump and European Commission President Jean-Claude Juncker on Wednesday announced that they have reached a deal to begin resolving a dispute over tariffs and avoid a trade war.

"We agreed today first of all to work together towards zero tariffs, zero non-tariff barriers and zero subsides for the non-auto industrial goods," Trump announced in a joint statement with Juncker in the White House Rose Garden.

The EU has agreed to increase U.S. soybean imports, lower industrial tariffs with the aim of dropping them to zero and work more closely together on regulations and energy, including buying more more liquified natural gas (LNG).

Trump and Juncker said they also would team up to intensify work on improving the World Trade Organization (WTO), a frequent target of Trump.

"We're starting the negotiation right now, but we know very much where it's going," Trump said during a brief joint statement in the Rose Garden on Wednesday afternoon.

Trump said they would "resolve" the retaliatory tariffs as well as the steel and aluminum tariffs that he imposed on the EU in May.

"When I was invited by the president to the White House, I had one intention: I had the intention to make a deal today. And we made a deal today," Juncker said.

Trump also backed off his threat to slap massive tariffs on foreign autos and auto parts.

The U.S. and EU will "hold off on other tariffs" while negotiations proceed, Juncker said.

With the promise of no new tariffs, Trump is stepping back from his threats to slap 25 percent tariffs on foreign autos and auto parts for now.

House Ways and Means Chairman Kevin Brady (R-Texas) said he is "particularly pleased that as long as good faith negotiations are underway, the parties have agreed that no additional tariffs will be imposed."

Following the White House meeting, Juncker headed to the Center for Strategic and International Studies to discuss the long-standing partnership that has recently become strained by Trump's barrage of tariffs.

During his remarks he called the relationship "enduring" and that "this was a good day for the transatlantic partnership."

Myron Brilliant, the U.S. Chamber of Commerce's executive vice president and head of international affairs, said "we welcome an open U.S.-EU dialogue so leaders can work quickly to reverse the damage caused by tariffs."

"American businesses are ready to get back to the work of creating jobs and driving the economy instead of worrying about the implications of a burgeoning trade war," Brilliant said.

In May, Trump removed an exemption for the EU and slapped tariffs of 25 percent on imported steel and 10 percent on aluminum.

The bloc responded with retaliatory tariffs on iconic U.S. goods including jeans, bourbon and motorcycles.

"We had a big day, very big," Trump said, calling the breakthrough "a new phase" in trade relations.

The Obama administration spent several years trying to negotiate a multi-trillion deal with the EU - the Transatlantic Trade and Investment Partnership (TTIP).

But Trump didn't take up the deal or pursue a new round of formal talks with the EU until now, even though the leaders have been talking more in recent months with the threat of metals tariffs looming.

Sen. James Lankford (R-Okla.), who attended a trade meeting at the White House on Wednesday, said he would continue to urge Trump "to conclude ongoing trade negations to restore certainty, open new markets and make our trade fair worldwide."

Markets responded favorably to reports of a deal on Wednesday afternoon.

Trump had escalated his rhetoric toward the EU at various times in recent weeks, most notably telling CBS News that he considers the longtime U.S. ally a "foe" because of trade.

Prior to Juncker's visit to the White House, he had raised the specter of taxing European cars, further ratcheting up concerns that the president would spark a global trade war. But with the promise of no new tariffs, Trump is shelving his plan to slap 25 percent tariffs on foreign autos and auto parts for now.

The U.S. continues to levy tariffs against Canada, Mexico and China, with each of those nations slapping retaliatory tariffs on American goods.

Republican and Democrats alike have warned that tariffs ultimately hurt American workers, but Trump has dug in on the policy.

Sylvan Lane contributed.

-Updated 8:41 p.m.