US-EU Trade War Looms as 15% Tariff Deal Hangs in the Balance

The United States and European Union are racing to finalize a trade agreement that would impose a 15% tariff on most EU goods imported into the US, aiming to avoid President Trump's threatened 30% tariffs.

As the August 1 deadline approaches, both sides are preparing for the possibility of a trade war, with the EU approving a €93 billion ($109 billion) package of retaliatory tariffs on US products if talks collapse. Markets have reacted to the uncertainty, with European equities rising on hopes of a deal, while exporters on both sides brace for potential losses. The negotiations follow a similar US-Japan trade pact and reflect escalating tensions in global trade policy.

If no agreement is reached, industries from cars to wine could be hit hard, and the transatlantic economic relationship may face its most severe test in years.