### Trump Threatens 50% Tariff on EU Goods, Reviving Global Trade Tensions

The global trade war, which had seen a period of relative calm, is back in full swing as President Donald Trump threatened to impose a 50% tariff on all European Union goods within a week. This move signals a sharp escalation in trade tensions and introduces significant market uncertainty, mere weeks before the crucial G7 summit in Canada.

President Trump’s latest tariff threat is a marked escalation from what was previously considered the worst-case scenario—a 20% tariff rate on the EU by early July after a 90-day pause. According to Treasury Secretary Scott Bessent, these heightened threats are intended to “light a fire” under the stalled trade negotiations between the US and its allies.

Following the previous de-escalation with China, key US allies such as the European Union and Japan slowed their negotiations with the US, anticipating they wouldn't face harsher treatment than China. Most of these nations believe that the US will once again back down if faced with market instability and rising inflation, as it did with China.

The impending trade war revival puts the EU in a dilemma—either to negotiate under pressure or to reinstate its own paused retaliatory measures. While the UK stands somewhat insulated due to its trade deals with both sides, a full-blown transatlantic tariff war could still deliver a significant trade shock.

Market reactions have been immediate; shares in the US and Europe have declined following Trump's assertion that trade talks with the EU are "going nowhere." Meanwhile, some US companies are beginning to feel the impact. The sportswear giant has attributed its price increases to "seasonal planning," while another major US chain has reported a sharp drop in sales, citing a "highly challenging environment."

The unfolding scenario not only revives global trade tensions but also foreshadows a period of volatility and economic uncertainty, with potential far-reaching consequences for markets and international trade relations.