US President Donald Trump and German Chancellor Angela Merkel (Image: GETTY)
He said “I like punitive tariffs” ahead of a US Commerce Department report this week. Trump is expected to raise tariffs from 2.5 percent to a whopping 25 percent within the next three months. The report, meanwhile, is expected to recommend that EU vehicle imports be classified as a threat to national security because it robs the country of an industrial base needed to produce military hardware.
The hike would be the impetus needed for Trump to lash out with increased duties.
Brussels has promised to retaliate to such a sudden measure with “swift and adequate” tariffs of their own.
Relations between the US and Europe has slumped to 2003-levels, amid Trump’s continued rhetoric on trade, his criticism of NATO and his withdrawal from the Paris climate change agreement.
Analysts fear that a tit-for-trade trade war could damage Germany’s economy so badly it slips into a depression, especially as its UK market is at risk due to Brexit.
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