Earlier this year, we examined the potential consequences of Trump’s renewed tariff agenda for the European Union. With a framework agreement between the EU and US now in place, the euro appreciating against the dollar and early trade data emerging, it’s time to revisit our earlier assessment. Export front-loading at the start of the year helped sustain export levels in the first half of 2025. However, we expect EU exports to the US to decelerate as tariffs begin to bite, reinforcing our call of a direct GDP impact of -0.3% in the short run with significant risks to growth in the longer run. With the conclusion of ... (full story)