Unhedged The EU folds on tariffs
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Jul 29, 2025 
Ben Hall, the Financial Times Europe editor, dives into the fallout of the recent trade deal between the EU and the US. The conversation highlights how Europe conceded to US tariffs, leaving consumers in both regions impacted. They explore Europe's hesitance to retaliate amid economic interdependence, and the challenges this poses for long-term strategies. Discussions on the implications for US energy exports versus manufacturing health add depth, showcasing the nuances of international trade dynamics.
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EU's One-Sided Tariff Deal
- The EU accepted 15% tariffs on 70% of its exports to the US but imposed no tariffs on US goods, creating a one-sided trade deal.
- This is seen as a defeat for the EU, influenced by a reluctance to escalate due to fear of Trump's retaliatory dominance.
Europe's Fear of Retaliation
- Europe fears the uncertain consequences of retaliating against US tariffs and is not accustomed to aggressive trade retaliation.
- This fear leads the EU to avoid escalating trade conflict despite having economic leverage.
Debate on Europe's Response
- Some argue Europe did smartly by not escalating tariffs since tariffs tax consumers and only reduce spending power.
- However, this may be complacent as such policies could be undermining the global trade system.