As the world has grown used to Donald Trump delivering aggressive ultimatums that are then revised or watered down, the shock-and-awe effect of a presidential edict on Truth Social has somewhat diminished. On Saturday, Mr Trump unexpectedly announced that the United States would hit the European Union with swingeing tariffs on goods of 30% from 1 August. That certainly prompted urgent weekend discussions in Brussels, Paris and Berlin. But for now, the European Commission president, Ursula von der Leyen, is placing all countermeasures on hold, in the hope that what the German chancellor, Friedrich Merz, described as “reasonable solutions” can be found.
Given the stakes, betting on the success of a softly, softly approach to trade negotiations remains sensible. Mr Trump’s previous imposition of 25% tariffs on European carmakers (on top of the pre-existing 2.5% rate) has already panicked German manufacturers in particular. But the president’s attempts to further batter Europe into economic submission, risking a trade war with an ally and threatening an annual €1.7tn worth of commercial activity, would be likely to trigger another market backlash if taken to the brink.
