Trade discussions between Trump’s administration and the EU have been described as going nowhere
U.S. President Donald Trump has threatened to impose 50 percent tariffs on the EU, starting next month, after stating that trade discussions with Brussels were “going nowhere.”
Trump made these remarks on his Truth Social platform. This represents a new escalation in his trade dispute with the European Union, which he has previously accused of being designed to exploit the US.
While the U.S. has reached agreements with the U.K. and China to mitigate their peak exposure to his trade war, the president’s EU threat, which would encompass all EU imports to the US, risks retaliatory actions from Brussels if implemented. Trump remarked about the discussions between his administration and the EU: “Our discussions with them are going nowhere! Therefore, I am recommending a straight 50 percent Tariff on the European Union, starting on June 1, 2025. There is no Tariff if the product is built or manufactured in the United States.”
The European Commission had yet to respond to these comments. Officials indicated there would be no statement until after a call between senior U.S.-EU trade representatives scheduled for later on Friday.
Read more: EU proposes tariff removal, Trump demands $350 billion in U.S. energy purchases
Market reaction
Financial markets, however, reacted swiftly. European stock markets experienced significant declines across the board.
The FTSE 100 in London was down more than 1.2 percent, while Germany’s DAX and the French CAC 40 fell by over 2 percent. U.S. stock market futures suggested that similar percentage declines could be anticipated for the major indices when Wall Street opened.
Concerns regarding potential damage to the global economy caused Brent crude oil to decrease by more than 1 percent to $63 a barrel. The dollar also suffered, as the news exacerbated existing market anxieties this week about the sustainability of US government debt levels. The pound was trading at levels not seen since February 2022.
Earlier, Trump stated that Apple would face 25 percent tariffs on its iPhones unless it relocates all its manufacturing to the US. Following this warning, Apple shares dropped over 2 percent in premarket trading, a message also shared on Truth Social. “I have long ago informed Tim Cook of Apple that I expect their iPhone’s that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else,” wrote the president. “If that is not the case, a Tariff of at least 25 percent must be paid by Apple to the U.S.” Production of Apple’s flagship phone takes place primarily in China and India, a recurring issue highlighted by President Trump.