Trump Threatens 15–30% EU Tariffs, EU Plans €90bn Retaliation
U.S. President Donald Trump has threatened to impose 15–20% minimum EU tariffs on all European imports, rising to 30% after August 1 if no deal emerges. He rejected Brussels’ proposal to cut auto duties, keeping current 25% levies on cars. In response, the EU is preparing over €90 billion in countermeasures targeting U.S. goods, including bourbon, Boeing and digital services, with €21 billion of tariffs on chicken and jeans set for August 6. These EU tariffs and retaliatory measures have already lifted Q2 customs revenues by nearly $50 billion and pushed the S&P 500 down 0.2%, signalling broader market volatility. Crypto traders should watch for rising inflation and dollar strength, as heightened macro volatility from this trade war may trigger risk-off sentiment in crypto markets, leading to short-term sell-offs and higher crypto-equity correlation.
Bearish
In the short term, the threat of higher EU tariffs and forthcoming €90 billion countermeasures is likely to increase global market volatility and drive risk-off flows in crypto assets, causing price declines and higher correlation with equities. Uncertainty over trade tensions may spur traders to exit volatile positions and boost demand for stablecoins as havens. Over the long term, persistent trade conflicts could sustain elevated inflation and strengthen the dollar, putting downward pressure on crypto valuations. Although supply chain disruptions and inflation hedging narratives may offer occasional support, overall macro risk and geopolitical friction point to a bearish outlook for crypto until trade talks stabilize.