& Tina Teng
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US President Donald Trump introduced on Sunday that he had agreed to delay the implementation of a 50% tariff on EU imports to 9 July, following a cellphone name with European Fee President Ursula von der Leyen.
The announcement sparked a pointy rebound in US inventory futures and boosted European equities on Monday.
“I agreed to the extension — July 9, 2025 — It was my privilege to take action,” Trump posted on Reality Social, quoting von der Leyen’s assertion on X, wherein she wrote:
“The EU and US share the world’s most consequential and shut commerce relationship. Europe is able to advance talks swiftly and decisively. To succeed in deal, we would want the time till July 9.”
Trump had initially introduced 20% “reciprocal tariffs” on the EU on 2 April earlier than lowering them to 10% for 90 days.
Nonetheless, he threatened to impose a 50% tariff from 1 June, citing a scarcity of progress in negotiations as a consequence of disagreements amongst EU member states. In keeping with the bloc’s commerce chief, Maroš Šefčovič, the EU submitted a revised commerce proposal to the US final week.
In a social media submit on Friday, Trump criticised the EU’s non-tariff boundaries, together with VAT regimes, “ridiculous company penalties,” non-monetary commerce restrictions, and “unjustified lawsuits towards American firms,” which he claimed contributed to an annual commerce deficit of over $250 billion (€219 billion). “Our discussions with them are going nowhere!” he wrote, justifying his transfer to boost import levies.
Trump’s tariff threats triggered broad market sell-offs in each the US and Europe on Friday, representing a renewed escalation in international commerce tensions, simply two weeks after the most recent spherical of US-China commerce talks.
European inventory markets open larger
Main inventory benchmarks in Europe opened larger on Monday following Trump’s reversal. The Euro Stoxx 600 jumped 1.00%, and the DAX surged 1.67% as of 9:25 am CEST.
“It is clearly a derivation of the Trump put. Nevertheless it’s prompting merchants to put their bets that any new tariff risk is bluster and any present tariff will finally be lowered,” stated Kyle Rodda, a senior market analyst at Capital.com Australia.
The US inventory futures additionally rebounded considerably, with the Dow Jones Industrial Common rising 0.85%, the S&P 500 up 1%, and the Nasdaq 100 climbing 1.19%.
Asian markets have been blended within the early buying and selling on Thursday, with Japan’s Nikkei 225 and South Korea’s Kospi rising, whereas Australia’s ASX 200 and China’s Hold Seng Index fell.
The euro hits a one-month excessive as greenback weakens
The euro prolonged features towards the US greenback throughout Monday’s Asian session. As of three:35 am CEST, the EUR/USD pair rose above 1.40, its highest degree since 29 April.
The greenback remained below stress after Trump’s tariff threats on Friday, with the US greenback index falling under 99 for the primary time in Might.
“Whereas a part of the dynamic is the market pricing in coverage convergence between the US and the remainder of the world, I believe the key driver of greenback depreciation is the marginal lack of confidence in US belongings,” Rodda stated.
Not too long ago, Moody’s downgraded the US credit standing, citing issues over rising authorities debt and the widening price range deficit. Trump’s proposed tax cuts and spending plans are additionally dealing with stiff opposition in Congress.
These compounding elements have renewed sell-offs in US belongings, together with equities, the greenback, and authorities bonds, prior to now week.