Munich begins with a slight setback as Back fails to hold ground strongly, according to Dax's initial assessment
US-EU Tariff Uncertainty Affects Global Markets
The implementation of a tariff deal between the US and the European Union has sparked uncertainty, with the potential implications for Japan and the EU remaining unclear.
Following a trade agreement announced on July 27, 2025, the current tariff on cars imported from the EU to the US stands at 15%, replacing a previously threatened 27.5% tariff. Similarly, cars imported from Japan to the US also face a 15% tariff under a separate trade deal. However, the tariff rate for cars imported from Japan to the EU is not specified in the available information.
This tariff cap of 15% applies to automobiles, as well as related goods such as car parts and semiconductors. The uncertainty surrounding the tariff deal has led to a state of stalemate on the Frankfurt Stock Exchange, with neither buyers nor sellers gaining the upper hand. This is evident in the drop of over seven percent in Munich Re's shares, due to the reinsurer accepting further price reductions, resulting in lower business volume.
The gold market has also seen changes, with a troy ounce of fine gold trading at 3,396 US dollars (-0.1 percent) in the morning, equivalent to 93.68 euros per gram. The price of gold has not reached a new record high due to the tariff announcement, but rather potential increases in demand. Many Americans are trying to acquire physical gold bars, anticipating that tariffs could boost demand and increase prices.
The European common currency (Euro) was slightly weaker on Friday morning, with one euro costing 1.1655 US dollars, and one dollar worth 0.8580 euros. The Dax started trading on Friday morning slightly negative, with the index calculated at around 24,140 points, 0.2 percent below the previous day's closing level.
Jochen Stanzl, Chief Market Analyst at CMC Markets, reiterated that investors on the Frankfurt Stock Exchange have been largely in the dark for over a week. The uncertainty regarding the implementation of tariffs between the US and the European Union continues, with it still unclear whether tariffs will add up to 27.5 percent or remain at the 15 percent tariff cap.
| Importing Country | Origin of Cars | Tariff Rate on Cars | Notes | |-------------------|---------------|--------------------|-------------------------------| | US | EU | 15% | Set by US-EU trade agreement | | US | Japan | 15% | US-Japan trade agreement | | Japan | EU | Not specified | No tariff data found in results|
As the situation develops, more information about the tariff deal and its implications for the global market is expected to become available.
- The uncertainty in the tariff deal between the US and the EU has created a stalemate on the Frankfurt Stock Exchange, affecting not only automobile manufacturing but also other related industries like finance, as investors wait for clarity on the final tariff rate.
- The forthcoming information regarding the US-EU tariff deal could impact various sectors of business, including financing and investing, as the potential implications for Japan and the EU remain unclear, which could lead to shifts in global investment patterns.
