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EU-US Trade Deal Slashes Tariffs, Boosts Energy Exports
31 Jul
Summary
- EU and US reach preliminary trade deal, reducing tariffs
- Companies report rising costs from tariffs, leading to price hikes
- Tech giants Microsoft and Meta post strong quarterly earnings
As of July 31st, 2025, the European Union and the United States have reached a preliminary trade deal that gives Donald Trump most of what he wanted. Under the agreement, EU exports to the US will be subject to a 15% tariff, lower than the 30% Trump had threatened. In return, the EU will eliminate tariffs on American-made vehicles and a range of other goods, including aircraft and chipmaking equipment.
The trade deal comes as other countries scramble to reach agreements with the US before an August 1st deadline. South Korea, for instance, has secured a 15% tariff on its goods, down from the 25% duty it had faced.
However, the impact of tariffs continues to be felt across various industries. Mercedes-Benz has blamed the duties for a decline in sales in North America and Asia, while Ford and Procter & Gamble have reported significant tariff-related costs, leading them to raise prices.
On a more positive note, tech giants have been thriving. Microsoft's net profit soared by 24% in the second quarter, and Meta's stock shot up after reporting solid earnings. The companies are optimistic about the future, with Microsoft announcing even more investments in "Superintelligence" to improve every aspect of its business.
Despite the ongoing trade tensions, the global economic outlook appears to be improving. The International Monetary Fund has raised its forecast for world economic growth this year to 3%, partly due to the fact that US tariff increases have not been as severe as initially threatened.
