The United States and European Union have reached a major trade agreement, narrowly avoiding a full-blown trade war just before a looming tariff deadline. The deal imposes a 15% tariff on most EU goods entering the US—half the 30% rate previously threatened by President Trump—but still much higher than current levels. In exchange, the EU agreed to purchase hundreds of billions of dollars in US energy and military products. While US markets cheered the certainty and averted escalation, European leaders and industries expressed concern over the economic impact and the perception of capitulation to US pressure. The agreement is expected to raise costs for industries like pharmaceuticals and autos, and could strain transatlantic alliances despite providing short-term stability.
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