GLOBAL MACRO VIEWS: Tariffs take the headlines, clarity wins the war

EU-US trade deal brings policy clarity despite 15% tariff headwinds

Markets responded cautiously to the recent EU-U.S. trade deal. While the 15% tariff on European exports appears to favour the U.S. in the near term, we believe the removal of trade uncertainty outweighs the tariff impact and marginally improves the outlook for European growth and investment.
For global investors, the agreement reduces geopolitical tail risks, offers clarity for key sectors and sets the stage for more stable economic conditions in the euro area. This is particularly relevant in a period where policy divergence and fiscal execution remain in focus.
 
Headline tariffs mask broader strategic gain
The 15% tariff imposed on European goods—exceeding the European Central Bank’s 10% base case—could result in a modest 0.1% to 0.2% drag on euro area GDP. However, beyond this headline, the strategic value of policy clarity is significant.
The agreement covers a wide range of sectors, including autos, pharmaceuticals and semiconductors, while leaving only metals unresolved. As such, it eliminates a major source of uncertainty, particularly in the context of a shifting U.S. policy landscape. While details will need to be clarified, European exporters now have greater visibility on trade conditions. This should unlock deferred capital expenditure, investment planning and supply chain adjustments.
 
Uneven near-term impact, longer-term clarity
Automobiles and pharmaceuticals will likely feel the most immediate pressure, especially firms with high U.S. exposure. However, resilient European demand, pricing flexibility and a clearer regulatory framework may reduce long-term risks.
Semiconductors benefit from inclusion, with trade alignment supporting European chipmakers in a strategically important sector. This may encourage investment in capacity and research and development.
Metals remain a risk point. Unresolved steel and aluminum tariffs could lead to continued volatility for European industrials until negotiations conclude.
 
Ambiguity remains around key implementation details, including EU commitments to increase U.S. energy imports and to ramp up investment directed to the U.S. However, the clarity offered by the trade negotiations should foster renewed business confidence through end-2025.
 
Read our complete analysis for detailed macro outlook, currency implications, and specific sector investment recommendations on our website.
 
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