EU Leaders Face Critical Deadline in Trump Trade Negotiations as Global Markets Watch

The European Union finds itself at a pivotal moment with merely two days remaining to secure a crucial trade agreement with Washington, as Donald Trump’s threatened 50% tariff on EU imports looms large. US Treasury Secretary Scott Bessent revealed on Friday that negotiations are centred on 15 to 18 agreements with key partners, whilst Trump has issued warnings of potential import tax rates reaching 70% for others.

Global economic tremors have intensified as Washington’s stance creates widespread uncertainty. Business investments have stalled, and the dollar has experienced its poorest performance in five decades during 2025’s first half. The European Commission remains uncertain about Trump’s approach to the bloc, with €1.6tn of transatlantic trade hanging in the balance ahead of the 9 July deadline.

Internal EU divisions have emerged regarding negotiation strategy. The German Chancellor advocates for a swift UK-style agreement to prevent a full-scale trade war, whilst French President Emmanuel Macron favours patience to secure more favourable terms. The aggressive tone towards the EU, which Trump previously described as “nastier than China,” was evident when Brussels’ Trade Commissioner Maroš Šefčovič faced threats of 17% tariffs on food imports during recent discussions.

Industry leaders across Europe are preparing for new challenges, regardless of the outcome. The minimum expected cost of Trump’s presidency appears to be a 10% levy on exports to the US, representing a fivefold increase from the 2% average before his election. The EU has acknowledged that a comprehensive trade deal is now beyond reach, focusing instead on securing a framework agreement similar to the UK’s May arrangement.

European diplomats, who initially dismissed the UK’s deal as inadequate and potentially problematic under WTO rules, had hoped the EU’s greater economic leverage would yield better terms. However, the reality of time constraints and political pressure has led to acceptance that a basic agreement may be the only achievable outcome.