Trump Threatens Fresh Tariffs on EU and Apple

Joe Lavorgna, Chief Economist at SMBC Nikko Securities discusses the President's tweets on tariffs affecting Apple and the EU. President Donald Trump threatened a sweeping 50% tariff on the European Union and a 25% levy on Apple Inc. if the tech giant failed to move iPhone manufacturing to the US, reigniting investor fears about his trade agenda.

Trump said Friday in a social media post that the higher charge on the EU would start on June 1 because “our discussions with them are going nowhere,” adding that he saw the bloc as “very difficult to deal with.”

Joe speaks with Bloomberg's Tom Keene and Damian Sassower.

“The president believes that the EU proposals have not been of the same quality that we’ve seen from our other important trading partners,” US Treasury Secretary Scott Bessent said on Fox News after Trump’s message, expressing hope “this would light a fire under the EU.”

Separately, Trump posted that he already told Apple the company’s popular smartphones should be made in the US and that he was nonplussed by its effort to partially move production from China to India.

Equities dropped across the globe, with the S&P 500 Index and the Stoxx Europe 600 Index each sinking about 1%. Apple led a selloff in tech, falling 2%. The dollar slid toward its lowest since 2023 and Treasury yields plunged across the curve.

The president’s missives represented a fresh round of trade brinkmanship, after previously indicating he was looking to wind down talks with partners over his April 2 duties, which he paused for 90 days to allow for negotiations. Trump’s attention this week has mostly been focused on a massive tax and spending package currently being considered by the US Congress.

Trump’s latest posturing comes after the EU earlier this week shared a revived trade proposal with the US in a bid to jump-start talks. The EU’s trade chief, Maros Sefcovic, is planning to hold a call with Jamieson Greer, his US counterpart, on Friday to take stock of negotiations, a European Commission spokesperson said before Trump’s post.

A spokesperson for the commission declined to comment on the president’s threat ahead of the discussion.

Irish Prime Minister Micheal Martin called Trump’s suggestion “enormously disappointing.”

“Tariffs are damaging to all sides,” Martin posted on X. “A negotiated outcome is the best possible result for both sides, as well as for global trade.”

Trump’s latest tariff threat would hit $321 billion worth of US-EU goods trade, lowering US gross domestic product by close to 0.6% and boosting prices by more than 0.3%, according to Bloomberg Economics calculations.

The new EU framework includes measures that take into account US interests, including international labor rights, environmental standards, economic security and gradually reducing tariffs to zero on both sides for non-sensitive agricultural products as well as industrial goods, according to people familiar with the matter.

It also outlined areas where the US and EU could cooperate, such as mutual investments and strategic procurement in energy, artificial intelligence and digital connectivity.

Others in Europe saw Trump’s threats as an attempt to gain leverage on the bloc rather than an ironclad directive.

“This is all part of the negotiation; we will look calmly at the proposals and respond robustly and firmly,” Dutch Prime Minister Dick Schoof said Friday during a weekly press conference.

But there were signals the negotiations were not proceeding well. One EU official described a prior US proposal as a wish list of unrealistic and unilateral demands, Bloomberg reported earlier. The EU is aiming to cooperate with the US, and is seeking a balanced and mutually beneficial deal. EU officials and many member states remain skeptical that the Trump administration is driven by similar goals.

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