German Chancellor Angela Merkel gestures during a meeting with young people and monks at the Salone Papale in Assisi, Italy, May 12, 2018. REUTERS/Yara Nardi

BERLIN (Reuters) - European relations with the United States have taken a knock after Washington pulled out of a nuclear deal with Iran, Chancellor Angela Merkel said on Tuesday.

Speaking at a congress of the Confederation of German Trade Unions (DGB), Merkel said Europe was not blind to Iran’s activities but still believed that sticking to the nuclear deal was the best way forward.