| The EU is preparing a shot across the US's bow on metals tariffs, but sparing bourbon |
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| Welcome to the Brussels Edition, Bloomberg's daily briefing on what matters most in the heart of the European Union. While the EU hopes for a deal to avert Donald Trump's across-the-board tariffs, it's readying a shot across the bow for the US. The bloc is planning 25% tariffs on a range of US products — from yachts to tobacco — as retaliation for Trump's earlier penalties on steel and aluminum. This time, unlike in Trump's first term, officials are sparing bourbon, a sign they were spooked by the threat of high wine levies in response. More broadly, EU trade chief Maros Sefcovic made the bloc's broader approach to tariffs clear: He's ready for talks with the Trump administration but "won't wait endlessly." German Economy Minister Robert Habeck said the EU should give its toughest retaliatory weapon — the anti-coercion tool — "a close look." France has urged a forceful response as the best way of gaining leverage in negotiations and Spain's Economy Minister Carlos Cuerpo told us all options are on the table. —Michal Kubala | |
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| No Contact | The EU hasn't yet talked to the US about any potential easing of the sanctions against Russia, the bloc's sanctions envoy David O'Sullivan told us. European leaders have so far ruled out lifting sanctions — which Moscow demands as a precondition in ceasefire negotiations — calling such a move premature while Russia's war in Ukraine still rages. Fearful Musk | Habeck didn't only have strong words for European leaders, but for Elon Musk as well. He said the billionaire's call for a zero-tariff system between the EU and US was a sign of weakness and fear. Germany's outgoing economy minister said Musk should tell Trump to end the trade war instead of doing damage control. Watching Impact | The EU is launching an import surveillance task force to look for signs of diversions in trade and the fallout from tariffs, according to Ursula von der Leyen. The commission president said the bloc previously offered to erase tariffs on industrial products, such as autos, if the US did the same, but got no response. Ireland Worries | Yet another sector that would feel the sting of a EU-US trade war is Ireland's housing market. The biggest concern is that tariffs could hit high-paying jobs at companies like Apple or Pfizer that have bases in the country — an impact Ireland's illiquid market might not be able to bear. | |
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| Drone Doubts | With Europe poised to spend record amounts on defense, allegations that Helsing's AI-equipped drones are overpriced and ineffective are doing little to shake investor enthusiasm. The company stands behind its technology and is being approached by banks about a prospective public listing. Read here about Europe's most valuable defense tech startup. UK's Steps | Donald Trump's auto industry tariffs prompted Keir Starmer to pledge full support for UK carmakers, reiterating measures announced earlier by the government. These include easing EV rules and giving manufacturers more flexibility on vehicle sales. The UK prime minister also hinted he's discussing responses to US tariffs with other European leaders.
Hotel Pivot | Eastern Europe's richest woman is fast solidifying her footprint in Prague's luxury hospitality sector. The PPF Group, owned by Renata Kellnerova and her family, is eyeing the city's Four Seasons, just weeks after securing its Hilton. If given the go-ahead, the move would leave PPF with control of 15% of Prague's five-star hotels and move the group further away from financial services. Leadership Fired| After more than a decade at the helm, Air Baltic CEO Martin Gauss was ousted following a vote of no confidence from its majority stakeholder, the Latvian state. The airline has faced mounting challenges in recent years — from Russia's war in Ukraine disrupting its eastward air travel and engine troubles to financial strains and a stalling IPO. | |
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| It's been an abrupt reversal for European stocks. After riding on optimism in past weeks over talks of German fiscal reforms and European investment in defense, Donald Trump's tariffs have now triggered a market rout. European stocks extended their fall yesterday, dragging the Stoxx 600 to its lowest level since January 2024. The plunge capped the worst weekly decline since the start of the Covid pandemic as previous top performers in the defense industry led the selloff. | |
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| All times CET - 4:30 p.m. Energy commissioner Dan Jorgensen speaks at EU energy summit in Brussels
- 12:20 p.m. NATO Secretary General Mark Rutte and Japan's Minister of Defense Gen Nakatani make remarks
- Von der Leyen holds video conference with pharmaceutical industry representatives
- EU foreign affairs chief Kaja Kallas visits Albania as well as Bosnia and Herzegovina
- Sefcovic meets members of the American Chamber of Commerce to the EU
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