President Donald Trump on Friday mentioned he’s “recommending a straight 50% Tariff on the European Union” after complaining that commerce negotiations have stalled.
The steep new import duties would begin on June 1, Trump wrote on Fact Social.
The EU “has been very tough to take care of,” Trump wrote of the 27-nation bloc. “Our discussions with them are going nowhere!”
Trump’s announcement got here lower than half-hour after he threatened to impose a tariff of no less than 25% on Apple‘s iPhones if the corporate didn’t begin manufacturing them in the US.
U.S. inventory futures sank instantly following the posts, which confirmed the Republican president as soon as once more wielding the specter of huge import taxes in response to financial exercise he disfavors.
European inventory markets fell 2%.
“The European Union, which was fashioned for the first objective of making the most of the US on TRADE, has been very tough to take care of. Their highly effective Commerce Boundaries, Vat Taxes, ridiculous Company Penalties, Non-Financial Commerce Boundaries, Financial Manipulations, unfair and unjustified lawsuits in opposition to People Firms, and extra, have led to a Commerce Deficit with the U.S. of greater than $250,000,000 a yr, a quantity which is completely unacceptable. Our discussions with them are going nowhere! Subsequently, I’m recommending a straight 50% Tariff on the European Union, beginning on June 1, 2025. There is no such thing as a Tariff if the product is constructed or manufactured in the US. Thanks on your consideration to this matter!”
It is a reversal in momentum for Trump, who lately touted preliminary commerce “offers” with China and the United Kingdom and has backed off different tariff proposals. Markets have been inspired by these strikes, as traders felt reduction from the financial uncertainty and instability Trump’s tariffs had threatened to create.
However Trump “believes that the EU proposals haven’t been of the identical high quality that we have seen from our different essential buying and selling companions,” U.S. Treasury Secretary Scott Bessent mentioned in a Fox Information interview Friday morning.
Requested if the EU will have the ability to negotiate within the 9 days earlier than the 50% tariffs kick in, Bessent mentioned, “I might hope that this is able to gentle a hearth beneath the EU.”
Trump’s posts tee up a probably tense trade between U.S. Commerce Consultant Jamieson Greer and his European counterpart later Friday. Greer is predicted to inform European Commerce Commissioner Maros Sefcovic in a gathering that Brussels’ newest transfer in ongoing commerce talks fails to satisfy U.S. expectations, the FT reported.
The EU was the second-largest purchaser of U.S. exports in 2022, taking in practically $351 billion of American items, in keeping with the Workplace of the U.S. Commerce Consultant.
The EU’s important government physique, the European Fee, declined CNBC’s request for touch upon Trump’s new tariff risk.
Trump has lengthy accused Europe of taking unfair benefit of the U.S. by means of commerce. He introduced a blanket 20% tariff on the EU on April 2 as a part of his “reciprocal” tariff plan, although he shortly revised that responsibility right down to 10% for 90 days.
Europe can be coping with Trump’s sector-specific tariffs, together with a 25% levy on all metal and aluminum imports.
“To go to 10% was going to be the very best tariff price that we had on the world in 90 years. To go to 50% is a very completely different order of magnitude,” Chicago Fed President Austan Goolsbee mentioned Friday morning on CNBC’s “Squawk Field.”
“In the event that they’re putting in tariffs which have a stagflationary affect, which is to say they slowed down output by elevating the price of manufacturing whereas additionally elevating costs, then that is the Central Financial institution’s worst scenario,” Goolsbee mentioned.
That is breaking information. Please refresh for updates.
— CNBC’s Ruxandra Iordache and Laya Neelakandan contributed to this report.
