Institutional analysis: Trump's imposition of 30% tariffs could bring the euro zone to the brink of recession

Angel Talavera of Oxford Economics said a 30 percent tariff on European Union imports into the United States could bring the euro zone to the brink of recession. Trump has threatened to raise tariffs on European Union goods from 10 percent to 30 percent as of August 1 if the two sides fail to reach a trade deal. Talavera said this could be a negotiating tactic for Trump, but according to the agency's calculations, if the high tariffs hit the ground, the euro zone's collective growth rate could fall by 0.3 percentage points over the next two years. In this scenario, the euro zone economy would stagnate for the next few quarters and come close to a sustained recession. "The risk that tariffs will exceed the 10 percent assumed by our baseline is now greatly increased," he added.