Global trade turmoil deepened on Wednesday as the European Union announced up to about $28 billion in retaliatory tariffs on U.S. exports, shortly after President Trump’s across-the-board levies on steel and aluminum imports took effect.
The latest escalations in the trade war instigated by Mr. Trump came hours before the release of the latest reading of the U.S. Consumer Price Index, which eased more than expected in February, a modest but welcome sign amid rising concerns about the effects of President Trump’s trade policies.
Mr. Trump has appeared undeterred by the uncertainty and fear that his tariffs, against friends and foes alike, have injected into the global economy. He has not ruled out the possibility that his policies could cause a recession in the United States.
The European Union said its retaliatory tariffs, which would take effect April 1, were proportionate to about $26 billion in tariffs applied by the United States. But European officials, already facing a lackluster economy, emphasized that they were ready to strike a deal with the Trump administration. “Jobs are at stake, prices up — nobody needs that,” said Ursula von der Leyen, president of the European Commission.
No other countries immediately announced further retaliation. China did not directly address the U.S. tariffs, although its Foreign Ministry spokeswoman said the government would take “firm measures” to safeguard its interests.
The 25 percent tariffs on imports of steel and aluminum have the support of U.S. domestic producers. But they could hit a range of industries, including car manufacturing, and potentially slow down the American economy.
Mr. Trump issued tariffs on Canada, Mexico and China last week, before quickly walking some of them back. Countries hit by the tariffs have vowed to retaliate with their own penalties, which will most likely hurt U.S. exporters.
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Metal suppliers: The latest tariffs will hit producers across several continents. Canada is the largest supplier of steel and aluminum to the United States. Brazil, Mexico, South Korea and Vietnam are also among the top suppliers of steel, while the United Arab Emirates, Russia and China are leading sources of aluminum. Among European countries, Germany is a major steel producer.
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Some U.S. allies hold back: Britain has chosen not to retaliate, as Prime Minister Keir Starmer looks to sign a long-term trade deal with the United States. And Prime Minister Anthony Albanese of Australia said his country would not impose reciprocal tariffs because they would hurt domestic consumers.
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Spooked markets: Stocks in Asia on Wednesday slightly moderated after a volatile day of trading, though shares in Australia fell for a second day. Wall Street markets have whipsawed this week, and shares of some big automakers, including Ford and Stellantis, have suffered losses.
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Economic impact: The release of the latest U.S. inflation data on Wednesday morning, and Mr. Trump’s threat that more tariffs could be on the way, will only add to worries about rising prices. The president has said he could impose penalties on foreign cars and other “unfair” relationships. Automakers were already unnerved by the prospect of higher steel prices after Mr. Trump opposed Nippon Steel’s proposed acquisition of U.S. Steel, a move that they worry will reduce competition for a crucial metal.
