Financial Times (FT) came out with the news suggesting further hardships between the US and the European Union (EU) as the bloc leaders respond to the Trump administration’s threat of new tariffs.
Key quotes
Brussels has criticized US threats to hit $3.1bn of European products with additional tariffs as ‘very damaging’, in the latest sign of growing transatlantic trade tensions.
The Trump administration’s announcement announced on Tuesday that it was considering further duties on products ranging from German beer to French sweaters prompted an angry response from the European Commission, which complained that it would further harm companies already reeling from Covid-19.
‘It creates uncertainty for companies and inflicts unnecessary economic damage on both sides of the Atlantic,’ said a commission spokesperson. ‘By potentially targeting new products, the US is increasing this damaging impact due to the cost of new disruptions to supply chains for the products potentially subject to new duties.’
FX implications
Considering the currently grim market mood, news like this adds burden on to the optimistic traders. The updates not only take down S&P 500 Futures to 3,048, down 0.06%, but also weighed on the AUD/USD pair, declining to 0.6869 from 0.6873.
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