US President Donald Trump stated on Sunday that he agreed to an extension on the 50% tariff deadline on the European Union (EU) till July 9 after a cellphone name with Fee President Ursula von der Leyen, per Bloomberg.
Von der Leyen stated earlier on Sunday in a social media publish that the EU was prepared to maneuver shortly in commerce talks with the US however wanted extra time to strike a deal.
Market response
On the time of writing, EUR/USD is buying and selling 0.12% increased on the day at 1.1378.
Tariffs FAQs
Tariffs are customs duties levied on sure merchandise imports or a class of merchandise. Tariffs are designed to assist native producers and producers be extra aggressive available in the market by offering a worth benefit over comparable items that may be imported. Tariffs are broadly used as instruments of protectionism, together with commerce limitations and import quotas.
Though tariffs and taxes each generate authorities income to fund public items and companies, they’ve a number of distinctions. Tariffs are pay as you go on the port of entry, whereas taxes are paid on the time of buy. Taxes are imposed on particular person taxpayers and companies, whereas tariffs are paid by importers.
There are two faculties of thought amongst economists relating to the utilization of tariffs. Whereas some argue that tariffs are mandatory to guard home industries and deal with commerce imbalances, others see them as a dangerous software that might probably drive costs increased over the long run and result in a dangerous commerce battle by encouraging tit-for-tat tariffs.
Throughout the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to make use of tariffs to assist the US financial system and American producers. In 2024, Mexico, China and Canada accounted for 42% of whole US imports. On this interval, Mexico stood out as the highest exporter with $466.6 billion, in accordance with the US Census Bureau. Therefore, Trump needs to deal with these three nations when imposing tariffs. He additionally plans to make use of the income generated by means of tariffs to decrease private earnings taxes.
