The 50% threat represented an abrupt escalation in the face of 20% tariffs already announced in April —the so-called «Liberation Day"—, which have not come into force thanks to the 90-day truce agreed with the UE, valid until July 9. The reaction was immediate: European stock markets fell sharply and fears of a new crisis grew transatlantic trade war.
The threat reactivated economic tension just after Brussels present a new negotiating proposal that takes into account the interests of United States, including the gradual reduction and eventual elimination of tariffs applied by both sides on non-sensitive agricultural and industrial products, according to Bloomberg. However, as on previous occasions, Trump reversed course a few days later.
Following a call from the President of the European Commission, Ursula von der LeyenHe agreed to maintain the original deadline of July 9. He presented the decision as a personal concession, while Von der Leyen spoke of a "good call" and avoided any mention of retaliation. Even so, the threat had already caused financial instability and diplomatic concern, which has become commonplace in trade relations with the world's leading power.
Source: CESCE
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