November 30, 2022

EU-US Trade talks: Dark Clouds over Washington

LQDFX blog: EU-US Trade talks

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The European Commission President visits the States for EU-US trade talks with the U.S. President.

The talks will focus on trade tensions after Trump’s decision to impose tariffs on imported steel and aluminium from EU. Back then, US tariffs set off a domino effect. EU began charging import duties of 25% on a range of U.S. products. Then, Τrump threatened to impose a 20% tariff on all imports of EU-assembled cars, characterising EU as a trade “foe”.

Jean-Claude Juncker will not arrive in Washington with a specific trade offer, according to the commission. However, the EU Trade commissioner said that EU Commission is preparing $20 billion counter-tariffs on U.S. goods if Washington imposes trade levies on cars imports.

The US President tweeted a pessimistic message regarding trade talks with EU stating that EU is not ready for a “Free Market”.

Besides, EU budget Commissioner stated that EU is ready to discuss mutual tariff lifts if US first drop tariffs on aluminum and steel imports.

Dollar, Euro ahead of EU-US Trade talks

The dollar and euro remain almost steady on Wednesday early trading, ahead of the Trump-Juncker meeting. Investors focus on the trade dispute between the two economic powers.

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FOREX – Currencies and commodities

The dollar was broadly traded flat against its major traded rivals, amid uncertainty over the continuation of the trading dispute.

The Yen dropped against the greenback flat as traders’ expectations that BOJ may downsize its monetary stimulus dashed.

The Australian Dollar weakened 0.2% against the US Dollar after soft inflation data.

The Euro rose 0.1% ahead of EU-US Trade talks, but gains were capped as traders focus on the trade dispute.   

The Sterling rose against the greenback, while it remained unchanged against the euro following May’s decision to lead Brexit negotiations.

Oil prices rose following data showed US crude inventories fall. Concerns regarding oil oversupply eased.

Gold prices inched up ahead of EU-US Trade talks.

Sources: Reuters, CNN money, the guardian

PLEASE NOTE The information above is not investment advice.