Trump Tariffs: EU Impact & Costs
- President Trump has proposed new tariffs targeting teh European Union and Apple, reigniting fears of a broader trade war.
- The proposed EU tariff replaces a previous 20% tariff set in April, increasing the likelihood of retaliatory measures from the EU, a major U.S.
- The 25% tariff on iPhones manufactured abroad coudl considerably raise consumer prices.
Trump’s proposed tariffs on EU goods and Apple iPhones have ignited fresh fears of a trade war and market volatility. The President’s suggestion of a 50% tariff on EU imports and a 25% tariff on iPhones signals a decisive shift in trade policy, perhaps impacting both businesses and consumers. This move, which follows previous trade tensions, will be one of the most talked about decisions in global markets. The EU’s possible retaliation could deepen economic uncertainty, while the market’s reaction, including initial declines and subsequent recovery, highlights the sensitivity to policy changes.As News Directory 3 reported, experts are considering adjustments to investment strategies. Discover what’s next from economic data due this week.
Trump’s Tariffs on Apple and EU Stoke Trade War Fears
Updated May 27, 2025
President Trump has proposed new tariffs targeting teh European Union and Apple, reigniting fears of a broader trade war. Via Truth Social,Trump recommended a 50% tariff on EU imports starting June 1,2025,and a 25% tariff on iPhones made outside the U.S.
The proposed EU tariff replaces a previous 20% tariff set in April, increasing the likelihood of retaliatory measures from the EU, a major U.S. trade partner. In 2024, the U.S. exported $370 billion in goods to the EU while importing $605 billion, resulting in a $235 billion trade deficit. However, the U.S. maintains a $109 billion service sector surplus with the EU.
The 25% tariff on iPhones manufactured abroad coudl considerably raise consumer prices. Apple CEO tim Cook previously negotiated exemptions from Chinese import tariffs in April 2025.
The market reacted to Trump’s announcements, initially declining before recovering following comments from scott Bessent. Bessent suggested the U.S. budget deficit would improve and that changes to the supplementary Leverage Ratio (SLR) could boost the bond market.
Despite the late-day recovery, the market remains overbought in the short term, suggesting potential consolidation. Recent gains have prompted some investors to increase cash positions and reduce equity exposure.
Analysts note that while the market appears bullish, rallies eventually end. The market is currently holding the 200-day moving average, indicating the previous correction phase may be complete.
“To be something with a 3% in front of it by 2028,” said Bessent,expecting the US budget deficit to improve with tariff revenue.
What’s next
The coming week will bring key economic data and Federal Reserve commentary. NVIDIA’s earnings on Wednesday could also introduce market volatility. The Fed is expected to address concerns about tariff-related inflation and the impact of rising yields. Personal income, spending, and prices will be released Friday.