Crisis Economy: The EU Responds To US Tariffs On Metals

The trade war between the United States and the European Union is intensifying. In response to Donald Trump’s decision to impose tariffs of 25% on steel and aluminum, the EU retaliates by announcing sanctions worth 26 billion euros. This escalation could have major consequences on the economy (particularly the commodity market).

Europe strikes back to preserve its economy: 26 billion euros at stake

The EU reacted promptly to the new taxes imposed by Washington. These protectionist measures penalize European industries. But that’s not all! They also undermine trade relations. With these new sanctions, the EU is indeed trying to restore balance in an already tense international market.

Among the products targeted by European reprisals, we find:

• foodstuffs,
• clothing,
• American manufactured goods.

The European Commission plans to hit these imports to exert pressure on key sectors of the American economy. Additionally, the implementation of these sanctions starting April 1 leaves room for negotiations with Washington. That being said, the Trump administration’s position remains inflexible.

The impact of these measures will be significant for European industries that depend on imported raw materials. The inflation could also be exacerbated by rising production costs. The automotive sector, particularly a consumer of steel and aluminum, fears a drop in competitiveness in the face of imports from other regions of the world.

An economic crisis that worries investors

The repercussions are not limited to steel and aluminum. China, also affected by these measures, has promised to take all necessary actions to protect its exports. The domino effect on the global economy is therefore palpable. The fact is that trade tensions weigh on investments, increase the risk of recession, and fuel inflation.

The United States imports about 50% of its steel and aluminum. These are indeed essential raw materials for sectors like construction, automotive, and defense. This dependence on foreign markets could paradoxically weaken the American economy in the long term, as companies will have to face increased costs.

Between American protectionism and European retaliation, the trade battle continues to impact the global economy. These tensions could create new opportunities for crypto investors, while undermining strategic sectors. It remains to be seen whether negotiations will help mitigate the impacts of this tariff escalation!