US President Donald Trump delivers remarks on the “Profitable the AI Race” AI Summit on the Andrew W. Mellon Auditorium in Washington, DC, on July 23, 2025.
Andrew Caballero-Reynolds | AFP | Getty Pictures
A commerce settlement between the European Union and U.S. could possibly be imminent, nevertheless with no ensures Brussels continues to arrange retaliatory measures.
A 15% baseline tariff fee, which incorporates an round 4.8% responsibility at present in place, is at present the base-case state of affairs for EU imports to the U.S., an EU diplomat instructed CNBC on Wednesday. Nonetheless, there is also some exemptions which might be nonetheless being labored out, they added.
The EU could in flip scale back its personal levies on the U.S., in line with the diplomat.
Negotiations between the U.S. and EU have been robust going with strain mounting forward of the Aug. 1 deadline which might see imports from the EU to the U.S. hit with a 30% tariff. Whereas that is decrease than the 50% fee Trump had beforehand threatened, it could seemingly nonetheless closely impression companies and economies in each the EU and the U.S.
“Relative to the chance of a lot greater further tariffs similar to 30% and even 50% that Trump had often muted earlier than, that will be a constructive end result,” Holger Schmieding, chief economist at Berenberg, commented in a be aware.
John Plassard, accomplice and head of funding technique at Cité Gestion, instructed CNBC’s “Europe Early Version” {that a} 15% fee can be “important however … not devastating” for markets.
“We do not suppose it is the top of the world,” Plassard stated, suggesting that whereas there was seemingly extra volatility forward, current developments have “been extra constructive than all of the speak and dialogue we had earlier than.”
The deal isn’t accomplished
However the deal is on no account accomplished but, with an EU diplomat telling CNBC the “last choice [is] in fingers of President Trump.”
A second EU official additionally appeared hesitant, telling CNBC that media reviews that the EU and the U.S. are closing in on a deal are “too optimistic.”
“Contacts between each side proceed, however till President Trump speaks his thoughts we do not have something concrete. Every little thing nonetheless stays within the open,” they stated.
Trump’s administration appeared to strike the same tone Wednesday. When requested concerning the potential for a 15% tariff fee, White Home Deputy Press Secretary Kush Desai stated discussions about any potential commerce offers must be thought of “hypothesis,” in line with a report from Reuters.
Trump is infamous for final minute modifications of coronary heart and making fast choices, the newest instance of which passed off earlier this week on the U.S.-Japan commerce deal. Throughout a gathering between Trump and the Japanese delegation, discrepancies and edits have been seen on a card outlining the deal on Trump’s desk, in line with a photograph posted on X by Dan Scavino, the White Home deputy chief of workers.
Regardless of European markets on Thursday being buoyed by the prospect of a deal, the uncertainty surrounding what a EU-U.S. settlement might appear like stays.
EU getting ready for no deal state of affairs
Within the meantime the EU remains to be engaged on countermeasures it might impose if U.S. tariffs do come into impact subsequent week.
Primarily, these are set to incorporate retaliatory tariffs which might come into pressure simply days after the U.S.’ duties. Underneath the EU’s new plan, beforehand ready lists of countermeasures concentrating on items, will likely be mixed in a single listing, totalling 93 billion euros ($109.4 billion).
There has additionally been widespread speak concerning the EU deploying its so-called “Anti-Coercion Instrument,” which has been described because the “nuclear choice.”
If enforced, U.S. suppliers might face restricted entry to the EU market. For instance they’d be unable to take part in public tenders within the bloc, there could possibly be curbs on exports and imports, and overseas direct funding could possibly be restricted.
Whereas France has to this point been the one nation to name “for instant institution of coercion,” if no settlement is struck, “there appears to be a broad certified majority voting for establishing coercion,” the EU diplomat instructed CNBC.