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'Russia Is Immune': Putin Aides Mock EU's New Sanctions; ‘Ukraine's Rout Will...,' Vows Medvedev

'Russia Is Immune': Putin Aides Mock EU's New Sanctions; ‘Ukraine's Rout Will...,' Vows Medvedev

Time of India19-07-2025
Russia openly mocks the EU's 18th sanctions package, which target its energy and financial sectors. Former President Dmitry Medvedev asserts Ukraine's "rout" will continue, unhindered by restrictions. Russia's investment envoy Kirill Dmitriev claims sanctions hurt the EU more. The Kremlin insists it has adapted to "anti-Russia" measures. This follows Trump's threat of 100% secondary tariffs and NATO chief Mark Rutte's warning to India, China, and Brazil over trade with Russia.
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Euro area yields drop after US-EU trade deal, Fed, BoJ, data in focus
Euro area yields drop after US-EU trade deal, Fed, BoJ, data in focus

Mint

time24 minutes ago

  • Mint

Euro area yields drop after US-EU trade deal, Fed, BoJ, data in focus

July 28 (Reuters) - Euro area government bond yields dropped on Monday after a trade agreement between the U.S. and the European Union introduced a 15% U.S. import tariff on most EU goods, broadly in line with economists' forecasts. Expectations of a tariff deal and a hawkish tilt from the European Central Bank prompted investors to scale back bets on future rate cuts last week, pricing in just a 60% chance of a 25 bps easing move by December. However, ECB policymakers appeared to temper market bets on no more rate cuts the day after the central bank meeting. Investors were staying on the sidelines at the start of a week packed with central bank policy meetings — including the Federal Reserve and the Bank of Japan — and key economic data releases from the U.S. and the euro area. Germany's 10-year government bond yield, the euro area's benchmark, was down 2 basis points (bps) at 2.70%, after rising more than 10 bps in the last two sessions. While roughly in line with reports from last week, the U.S.-EU trade deal removed near-term "no deal" and higher tariff scenarios. "Mutually disruptive escalation and retaliation between two global trade heavyweights will be avoided," said Mark Wall, chief euro area economist at Deutsche Bank. Some economists argued that the deflationary impact of a 30% tariff on EU goods - the rate U.S. President Donald Trump had threatened to impose without a deal - could have prompted the ECB to cut its deposit rate to 1.5% from the current 2%. Markets are pricing an ECB depo rate at 1.84% by December -- implying a 65% chance of a rate cut by December -- from 1.85% late Friday and 1.78% before the ECB statement on Thursday. They indicated a depo rate at 1.73% early last week, before a U.S.-Japan trade deal helped ease fears over the recessionary impact of a trade war. The Bank of Japan is set to hold off raising interest rates on Thursday but may signal rate hikes later this year, after the trade agreement. Trump said on Friday he had a good meeting with Fed Chair Jerome Powell and got the impression that the head of the U.S. central bank might be ready to lower rates. Markets still expect rates unchanged. German 2-year government bond yields – more sensitive to expectations for European Central Bank policy rates – fell 1.5 basis points (bps) to 1.92%. Italy's 10-year government bond yields were down 3 bps at 3.55%, with the spread between BTP and Bund yields - a market gauge of the risk premium investors demand to hold Italian debt - at 85.5 bps. It hit 84.20 bps in June, its lowest since March 2015. (Reporting by Stefano Rebaudo, editing by Ros Russell)

‘He knew where to hit us': Did Trump strongarm EU into signing trade deal? Steep price for shaky peace
‘He knew where to hit us': Did Trump strongarm EU into signing trade deal? Steep price for shaky peace

Time of India

time37 minutes ago

  • Time of India

‘He knew where to hit us': Did Trump strongarm EU into signing trade deal? Steep price for shaky peace

The United States and the European Union have averted a full-scale trade war, but the price of peace is steep. In a high-stakes, hastily arranged meeting at President Donald Trump's golf resort in Turnberry, Scotland, Trump and European Commission President Ursula von der Leyen announced a trade deal that will impose a 15% baseline tariff on most EU goods entering the US: a compromise designed to stave off Trump's threatened 30% tariff if no agreement had been reached by August 1. Tired of too many ads? go ad free now Trump hailed the agreement as 'the biggest-ever,' while von der Leyen called it 'the best we could get.' But behind the triumphant rhetoric lies a deal many in Brussels quietly acknowledge as a strategic retreat. A deal under pressure The deal, struck in under an hour, came after months of threats, stalled talks, and tariff escalations that rattled European markets and unnerved EU leaders. According to CNN, the US president had threatened tariffs as high as 50%, pushing the EU to the negotiating table under mounting economic pressure and fears of NATO destabilisation. Trump's administration insisted on a 15% blanket tariff, covering cars, semiconductors, pharmaceuticals, and more. Although von der Leyen claimed some strategic products such as aircraft, select chemicals, and agricultural goods would see zero tariffs, many sectors remain exposed. The AP reported that energy and defence purchases sweetened the deal — with the EU agreeing to spend $750 billion on US energy and invest a further $600 billion in American industries. Yet steel and aluminium will still be hit with 50% tariffs. Trump was blunt: 'Steel stays the way it is.' Von der Leyen maintained that a quota system would eventually moderate those terms, but no final text has been released. EU countries must now ratify the agreement. Ireland said it 'regrets' the baseline tariff, and Germany's powerful BDI industry group warned of 'considerable negative repercussions.' The VCI chemicals association simply called the tariffs 'too high.' Tired of too many ads? go ad free now As CNN noted, while markets responded positively with the Dow rising 0.3% few in Europe are celebrating. Europe's pain threshold — and trump's street fight Multiple reports, including from Financial Times and BBC, paint a picture of a bloc outmanoeuvred. Trump's early-April 'Liberation Day' tariffs sent markets reeling, forcing Brussels to suspend retaliation and enter talks under duress. FT reported that EU diplomats believe the bloc's fragmented stance — especially Germany's desire to shield its car industry — prevented a stronger response. One EU diplomat told FT, 'He's the bully in the schoolyard and we didn't join others in standing up to him.' Former Commission negotiator Georg Riekeles said the EU 'would have been better off answering the US vigorously in April in a one-two combo with China.' The Commission had originally drawn up a strategy to offer purchases and tariff reductions. But the Trump administration moved faster, levying 25% tariffs on steel, aluminium, and vehicles. Meanwhile, internal divisions saw some states pushing for tough retaliation and others urging caution. Irish Trade Minister Simon Harris was reportedly a vocal advocate for protecting Irish pharmaceuticals and spirits, according to FT. The Trump camp saw opportunity in these divisions. He rejected a July proposal for a 10% 'reciprocal' tariff, demanding instead 15% across the board. As BBC pointed out, Trump viewed the EU as exploiting US openness while restricting access to its own markets — a sentiment echoed by his claim that the union was 'nastier than China.' Symbolic win? The final deal delivers predictability and avoids escalation — but at a cost. Most European exports now face higher tariffs than under the previous regime, where the US average was around 1.6%, FT found. The 15% rate, while lower than Trump's threats, is still a substantial barrier and could erode the EU's export competitiveness. Car manufacturers are particularly exposed. Volkswagen has already taken a $1.5 billion hit this year, and Mercedes-Benz warned of 'significant increases' in US prices. While Trump said pharmaceuticals were not part of the deal, von der Leyen later insisted they were 'on a separate sheet of paper' — hinting at continuing negotiations. Still, there's relief that a deeper trade war was averted. BBC noted that Brussels' chief concern was avoiding Trump's wrath spilling over into security cooperation, especially in Eastern Europe and Ukraine. The EU is now betting that stability is worth the compromise. In Trump's words: 'This was the big one.' For von der Leyen and EU officials, the deal may mark not a victory, but the moment the US president 'worked out exactly where our pain threshold is.'

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