Trade continues to be the most pressing issue on the financial markets. Besides the ongoing trade war between China and the United States, now the US has officially engaged in a conflict with the European Union as well.
Last night the United States announced 25% tariffs on French wine, whiskey from Scotland and Ireland, and all kinds of European cheese coming into the US, as well as a 10% tariff on Airbus aircrafts.
European stock indices marked losses after the announcement. However, it was not as bad as previously expected, as many types of goods were spared from tariffs, at least for now. The stocks of European clothing giants such as H&M and Zara performed extremely well, giving investors some hope.
Meanwhile, the European Union is also dealing with Brexit at the moment. UK Prime Minister Boris Johnson has sent in his plan for a withdrawal agreement. Today chief EU officials stated that while Johnson’s proposals were not as bad as they had expected, they do not address the issue of the Irish border properly.
There is still no viable alternative to the Irish backstop that Johnson has put forward, so the EU is expected to send a list of objections to the proposal and have the Prime Minister work on a revision. Johnson will also do a Q&A in the UK Parliament today where he is likely to face harsh criticism from the opposition.
