EU Readies Tariff Plan for US if Trade Talks Fall Through
The plans come as EU member states, including Germany, have hardened their positions in response to the US stiffening its negotiating stance.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
10 minutes ago
- Yahoo
A Data Deluge Brings a ‘Moment of Truth' for Markets This Week
(Bloomberg) -- Wall Street pros are staring down a pivotal week that will likely set the tone for the rest of the year in markets and the economy. The High Costs of Trump's 'Big Beautiful' New Car Loan Deduction Can This Bridge Ease the Troubled US-Canadian Relationship? Trump Administration Sues NYC Over Sanctuary City Policy First and foremost is the conclusion of the Federal Reserve's meeting on Wednesday, and although it isn't expected to cut interest rates, traders and investors will be poring over commentary for clues about the path ahead. Then there's a string of Big Tech earnings with Inc., Apple Inc., Meta Platforms Inc. and Microsoft Corp. all reporting. And sprinkled throughout are some of the leading indicators on the state of the economy, from gross domestic product to nonfarm payrolls. In other words, if there ever was a five-day stretch that would define the second half of the year, this is it. 'This week's packed calendar — trade negotiations, the FOMC, the jobs report and four of the Magnificent Seven names reporting — makes it truly a moment of truth for markets,' said Julian Emanuel, chief equity and quantitative strategist at Evercore ISI. He was referring to the Federal Open Market Committee, the panel within the Fed that sets interest rates. The fire hose of releases will test investors' faith in the resilience of the US economy and the stock market's seemingly unstoppable rise. And with President Donald Trump's self-imposed tariff deadline of Aug. 1 — which he's said won't be extended — markets are hoping for some sense of stability on trade negotiations after months of whiplash. 'I think there is more of a chance of markets getting clarity on the continued resilience of the economy, while we get less clarity on the trade front,' said Kevin Gordon, senior investment strategist for Charles Schwab & Co. ''Reciprocal tariff' deadlines are staggered for some of our largest partners, and there are still lingering questions around already-announced deal frameworks, so I don't think of Aug. 1 as some magical date on which we'll stop being gripped by tariff anxiety.' S&P 500 companies are generally beating forecasts and profits are up 4.5% from this time a year ago, according to Bloomberg Intelligence data. Firms like Southwest Airlines Co., which said tariffs shaved $1 billion from its annual pre-tax profit this year, expect to see improvements in the second half. 'We already see signs that demand is coming back in volumes,' Chief Executive Officer Bob Jordan said in an interview. Much of the earnings strength is being driven by wealthier customers. American Airlines Group Inc. highlighted strength in their premium cabin demand, while Deckers Outdoor Corp. cited pricey shoes like Ugg sheepskin boots and Hoka sneakers. United Airlines Holdings Inc. and Delta Air Lines Inc., said corporate travel was leading their rebounds. On the flip side, Chipotle Mexican Grill Inc. cut its guidance because the 'lower-income consumer is under pressure,' Chief Executive Officer Scott Boatwright said, which has led to a drop in spending. There are other signs of stress, with companies like Conagra Brands Inc. and Abbott Laboratories discussing higher costs due to tariffs. In particular, consumer discretionary stocks are expected to see profit declines into the start of 2026 as trade policies start to bite, Bloomberg Intelligence strategists Gina Martin Adams and Michael Casper warn. 'We already have some corporate commentary as to what effect tariffs are having and will at an individual level,' said Dan Greenhaus, chief economist and market strategist at Solus Alternative Asset Management. 'But the truth is, we probably need several more months before having a firmer handle on the cost distribution.' Economic Uncertainty Economic data has also been uneven as the tariff impact is just starting to hit. The government's initial estimate of second-quarter GDP is expected to show a notable rebound in growth after a monumental surge in imports caused a contraction at the start of the year. 'It won't be until after the market and economy have had an opportunity to digest the new tariff rates that become effective on Friday that we will know where we stand,' said Michael O'Rourke, chief market strategist at JonesTrading LLC. Other reports due this week may point to some softening in the economy. Economists expect consumer spending barely grew in June after adjusting for inflation, and other estimates point to a continued slowdown in hiring and uptick in unemployment. They're also projecting an acceleration in the Fed's preferred measure of inflation — the personal consumption expenditures price index — as tariffs start to hit. 'It's not the cliff that most people are always looking for when it comes to an economic downturn, but it is a visible slowdown if you take the time to actually lift the hood and look at the underlying details,' said Gregory Daco, chief economist at EY-Parthenon. Despite all the uncertainty, the stock market is trading at record highs as fears of worst-case tariff scenarios have failed to materialize. The question is how long that can last. 'I think there are a few different factors here. First, there are signals that the labor market is holding up well, wages are growing faster than inflation — both of which supports the consumer in aggregate,' said Cayla Seder, macro multi-asset strategist at State Street. 'When it comes to the stock market, earnings have been beating a low bar, which has indicated the companies are holding up better than feared.' --With assistance from Shelly Banjo and Matt Turner. Burning Man Is Burning Through Cash It's Not Just Tokyo and Kyoto: Tourists Descend on Rural Japan Confessions of a Laptop Farmer: How an American Helped North Korea's Wild Remote Worker Scheme Elon Musk's Empire Is Creaking Under the Strain of Elon Musk A Rebel Army Is Building a Rare-Earth Empire on China's Border ©2025 Bloomberg L.P.
Yahoo
10 minutes ago
- Yahoo
Trump deal with Europe underlines new standard of (at least) 15% tariffs
President Trump and European Commission President Ursula von der Leyen announced a trade deal Sunday with a range of somewhat vague plans for energy purchases and open markets but one thing crystal clear: a tariff rate of 15% on European goods. It's the latest example of a new tariff floor for Trump that has been backed by other recent deals and letters, including one with Japan this past week that also saw a 15% rate. "We'll have a straight simple tariff of anywhere between 15% and 50%," Trump asserted. Both Trump and von der Leyen highlighted the 15% rate Sunday after their meeting in Scotland. Trump claimed a 'straight-across tariff of 15%' for 'automobiles and everything else,' adding that US exports to Europe would face a 0% rate. Von der Leyen confirmed the 15% tariffs 'across the board and inclusive," adding that it would bring stability and predictability to US-Europe relations. Trump added that the deal includes hundreds of billions of dollars in new EU purchases of U.S. energy as well as military equipment. The 15% rate may get a mixed reaction in Europe after negotiators had previously pushed for free trade (or more recently a 10% rate), but it's a halving from the 30% tariffs Trump promised in a letter earlier this month. Sunday's agreement with the European Union — America's largest trading partner — comes following agreements with Vietnam, the Philippines, and Indonesia with saw tariff rates of between 19% and 20%. Only one negotiation has seen Trump agree to a tariff below 15% — a pact with the UK in May — with Treasury Secretary Scott Bessent writing earlier this month, "usually the first person who makes a deal makes the best deal." Some details unclear Trump also said Sunday that many of the remaining countries facing a deadline of August 1 would face a letter dictating rates, saying they would be be 'very universal for most' and that the European deal is 'the big one.' The president said three to four additional countries could be in for deals in the the coming days while most nations would simply get letters. In any case, the 15% baseline is a shift — even from recent weeks. Trump earlier this month said that many countries would see a rate of 'probably 10% or 15%, we haven't decided yet.' Even last Sunday, Commerce Secretary Howard Lutnick told CBS: "You should assume that the small countries... will have a baseline tariff of 10%." This new standard is also notable fulfillment of an oft-made campaign trail promise that saw the then-candidate pledge to create a "ring around the collar" of the US economy with a blanket rate of between 10% and 20%. Fulfilling that pledge — which was often dismissed as unrealistic at the time — has now become not only accepted but even a plus for markets after six months of Trump's second term have seen threats of higher duties that have reordered world trade actions. The recent announcement of the deal with Japan with a 15% tariff on goods like autos was welcomed by traders and helped fuel rises in US markets as well as the Japanese Nikkei 225, which immediately surged on the news. Japanese automakers in particular saw a jump after that deal as those companies celebrated a lowering of auto tariffs from 25% to 15%. European automakers now find themselves in a similar position. Trump, meanwhile, says he has no plans to amended his other sector specific tariffs as part of the European Union deal — even as Von der Leyen called the 15% tariffs 'inclusive." There are 50% tariffs currently levied on steel and aluminum (with planned duties at the same rate on copper), and Trump said Sunday that those tariffs are a "worldwide thing that stays the way it is." Trump also reiterated his promises of sectoral tariffs on semiconductors and pharmaceuticals to be rolled out, which could be much higher than 15% — unless Europe gets a carveout. Also on Sunday, Commerce Secretary Howard Lutnick said that a new semiconductor tariffs are nearly ready and would be unveiled in about "two weeks time." Ben Werschkul is a Washington correspondent for Yahoo Finance. Click here for political news related to business and money policies that will shape tomorrow's stock prices Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
10 minutes ago
- Yahoo
EU's von der Leyen: trade deal delivers certainty in uncertain times
PRESTWICK, Scotland (Reuters) -European Commission President Ursula von der Leyen on Sunday said a U.S. baseline tariff rate of 15% on imported EU goods would apply to cars, semiconductors and pharmaceutical goods. She also said that a zero-for-zero tariff rate had been agreed for certain strategic products, including aircraft and aircraft parts, certain chemicals, and certain generic drugs. No decision had been taken on a rate for wine and spirits, she added. "Today's deal creates certainty in uncertain times, delivers stability and predictability," von der Leyen told reporters before leaving Scotland. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
