Crypto News: Brussels Edition: US-EU trade war resurfaces

Welcome to the Brussels Edition. I’m Oliver Crook, chief Europe correspondent for Bloomberg Television, bringing you the latest from the European Union. Make sure you’re signed up.

It’s hard to keep track of what iteration of the trade war we’re on but it seems, more than a year after Liberation Day, there’s a chance the US-EU trade conflict is back.

Trade is high on the list of topics the Europeans would like to consider settled and never have to talk about again (the only thing higher on that list, perhaps, is the question of US commitment to NATO).

But, with the flick of a wrist on Truth Social, 25% auto tariffs on European cars are back on the table.

As ever, there are more questions than answers right now. But two are fundamental. First, what does President Donald Trump actually want. And, second, as a consequence, what should Europe do in response?

Eurogroup President Kyriakos Pierrakakis, who is chairing a meeting of euro-area finance ministers today (hijacked yet again by erratic behavior from the White House) gave his appraisal: “Needless to say, this discussion that’s currently taking place is quite unnecessary and quite unfortunate. The last thing the global and the European economy needs right now is an extra layer of uncertainty on top of what’s happening in the Strait of Hormuz and in the Middle East.”

Indeed, growth forecasts have been slashed across Europe due to the energy shock from the war in Iran, while Europe’s car industry has taken beating after beating; additional tariffs are the last thing European finance ministers want to deal with.

Trump says the EU is not complying with the trade deal agreed in July of last year. It’s unclear what precisely he means, but it is true that Europe has not yet implemented the accord, as it’s still passing through the (quite slow) legislative process.

“The number one choice is always dialogue — we want to be a predictable partner in the international economy, we believe in the transatlantic relationship,” he told Bloomberg Television. “But having said this, if there is a deviation from what we have agreed upon, obviously all options are on the table and all choices will be on the table.”

So if this is just a ploy by Trump to put pressure on the EU to ratify the trade deal faster, then dialogue will probably succeed. If it is, however, something bigger, retaliation is on the table, which risks sending us back to square one.

The Latest

NATO Secretary General Mark Rutte warned European leaders that Trump is disappointed with their reluctance to assist with the Iran war.
German authorities seeking to map out US supply-chain vulnerabilities as a way to win leverage with Washington have identified a key pressure point: potash.
Meanwhile, the country is preparing its supply lines for a potential war, but it’s far from ready.
Jean-Luc Melenchon said he will run for French president for a fourth time, positioning himself as the most established left-wing contender in the race to succeed Emmanuel Macron in 2027.
The EU is working on resolving the thorny issue of Montenegro’s unilateral use of the euro, an obstacle for the Adriatic nation’s plans to join the bloc, Finance Minister Novica Vukovic said.
The EU moved to exclude the leather industry from its landmark law tackling global deforestation as the bloc seeks support from key sectors and countries before the legislation kicks in at year’s end.

Seen and Heard on Bloomberg

Cohen Group Senior Adviser Jen Gavito said Trump’s plan to cut the US military presence in Germany by more than the 5,000-troop drawdown announced so far is not just tied to his frustration over NATO. “I suspect that this is even more personal and goes back to the chancellor’s comments the other day that the president doesn’t really have a plan when it comes to the conflict in Iran,” she told Bloomberg TV.

Chart of the Day

Euro-zone inflation will jump to 2.7% on average this year but return close to the ECB’s 2% target already next year, according to the institution’s quarterly survey of professional forecasters. Respondents revised up their expectations for 2026 significantly — from 1.8% in the previous round — while they see price gains of 2.1% and 2% in 2027 and 2028. At the same time, they forecast slightly slower economic growth than before. Meanwhile, Governing Council member Peter Kazimir said it’s highly likely that the ECB will have to raise interest rates at its next meeting in June.

Coming up

Euro-zone finance ministers press conference in Brussels this evening
EU-Armenia summit continues in Yerevan tomorrow
EU finance ministers meet in Brussels tomorrow

Final Thought

<em>Illustration: David Huang For Bloomberg</em>

It’s a weird time to be named Claude. Up until now people with that name have enjoyed the small luxury of name singularity. But it is now shared with Anthropic’s fast-growing AI assistant — leaving the humans called Claude to adjust.

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