US Trade Representative's office: 10 and 25% tariffs on EU goods will take effect from October 18th

US Trade Representative's office says planned 10 and 25% tariffs on EU goods will take effect from October 18th. The U.S. planned to impose tariffs on European Union goods including aircraft and agricultural products., which was announced at the start of this month. Airlines decried the move, and markets will not take this kindly, considering the concerns over a slowing global economy partly driven by the Trump administration’s trade conflicts with China and now the EU.

The USTR released a list of products it plans to target earlier this month, considered to be intensifying the Trump administration’s global trade battles.

The duties include:

• 10% tariffs on aircraft from France, Germany, Spain or the United Kingdom.
• 25% duties on single-malt Irish and Scotch whiskies, various garments and blankets from the U.K.
• 25% tariffs on coffee and certain tools and machinery from Germany.
• 25% duties on various cheeses, olive oil and frozen meat from Germany, Spain and the U.K.
• 25% tariffs on certain pork products, butter and yogurt from multiple countries.

FX implications

Trump's administration increased tensions with the bloc last year by putting on put tariffs on steel and aluminium imports, (the EU slapped duties on about $3 billion in American goods, including bourbon and motorcycles in retaliation), and this is an escalation of them wch could be the next imminent risk-off catalyst as markets digest the implications. Risk-FX such as the Yen would be seen to benefit from global trade tensions.

• Update: France’s Le Maire: Europe ready to retaliate if us moves with tariffs.