Recent statements by Donald Trump regarding a possible 50% tariff on all imported goods from the European Union did not provoke a significant reaction from European investors.
Economic Implications
Economists warn that the full implementation of a 50% tariff would lead to significant losses. Capital Economics' Andrew Kenningham stated that if such a tariff were enacted, Germany's GDP could shrink by 1.7% over three years.
Analyst Reactions
Analysts believe that Trump's threat is a negotiation tactic rather than a real policy. Ajay Rajadhyaksha from Barclays noted that the proposed 50% tariffs are unlikely to materialize.
Europe's Retaliatory Plans
European authorities have already prepared retaliatory tariffs set to take effect on July 14. ING's Inga Fechner warned that the EU is ready to not only impose tariffs but also tighten regulations regarding US technologies.
The current situation demonstrates that threats from the US can impact international trade relations and provoke responses from Europe, although analysts consider the actual implementation of such measures unlikely.
