The US and EU have averted a looming trade war with a landmark agreement imposing a 15% tariff on most European exports to America, finalized Sunday during talks between US President Donald Trump and European Commission President Ursula von der Leyen. The deal replaces an August 1 deadline that risked far steeper tariffs, but has drawn sharp criticism from European leaders.
Bernd Lange, chair of the European Parliament's Committee on International Trade, called the framework "unsatisfactory," noting the EU would face a fourfold tariff increase while committing to zero tariffs on US goods. Finnish Minister Ville Tavio acknowledged the deal "calmed the situation" but warned against celebration, calling the terms "too high," according to Yle News.
French Prime Minister Francois Bayrou struck a somber tone, telling Reuters the agreement reflected a "submission" by allies meant to uphold shared values. Meanwhile, analysts like Morgan Stanley’s Michael Zezas cautioned that while US recession risks have eased, trade controls could still stifle growth amid "slow growth and firm inflation."
Markets reacted swiftly: the dollar surged 1% against the Swiss franc, while the euro saw its steepest daily decline since May. The deal’s long-term impact on transatlantic relations and global economic stability remains uncertain, with observers urging caution as details unfold.
