Evening Briefing: Europe

A growing number of European Union member states, backed by France, want the bloc to activate its most powerful trade tool against the US should the two sides fail to reach an acceptable agreement by Aug. 1.

The charge to deploy the EU’s so-called anti-coercion instrument if President Donald Trump carries out his threat of 30% tariffs is backed by more than half a dozen European capitals, we’re told. Several member states are understood to be more cautious, while others have yet to express a position.

Those measures could include new taxes on US tech giants or targeted curbs on US investments in the EU. They could also involve limiting access to certain parts of the region’s market or restricting US firms from bidding for public contracts.

The overwhelming preference among capitals and EU officials is to keep negotiations on track and find a negotiated outcome to the impasse. The bloc’s trade chief, Maros Sefcovic, will travel to Washington for further talks with his US counterparts this week. — Jennifer Duggan

What You Need to Know Today

ASML Chief Executive Officer Christophe Fouquet walked back his forecast that sales will grow next year, blaming trade disputes and global tensions. Fouquet, who in October told investors he expected 2026 to be a growth year for the semiconductor industry and ASML, took a more cautious stance today when the company reported its second-quarter results. The firm’s shares fell as much as 8.5% to €646.30, the biggest intraday decline since April 7. It has shed €134 billion in value over the last year.

The EU has proposed a budget of close to €2 trillion for the next seven years, as it seeks to fend off a range of challenges from rising global economic competition to increased defense demands. It is understood that the plan, which will kick in from 2028, was agreed after negotiations that stretched late last night and resumed this morning. The bumper figure is likely to get pushback from some EU member states already struggling with budgetary issues.

Stocks fell and short-dated bonds climbed after a White House official told us that Trump is likely to fire Federal Reserve Chair Jerome Powell soon. The dollar halted a four-day advance. Equities wiped out gains as the report said the president had discussed the possible move in a meeting with congressional Republicans yesterday, though Trump has not made a final decision and could change his mind.

Jerome Powell Photographer: Bloomberg/Bloomberg

The UK Labour Party suspended a number of its members of Parliament for breaking party discipline following a large-scale rebellion over welfare cuts earlier this month. A number of media outlets reported today that Labour had suspended at least three MPs. Labour was forced to U-turn on its plan to cut welfare payments to disabled people earlier this month after 126 of its own MPs threatened to vote against the proposals.

Istanbul Mayor Ekrem Imamoglu was sentenced to nearly two years in prison, after a court found him guilty of “threatening” the city’s chief prosecutor. The sentence falls short of banning Imamoglu from politics, which would have dealt a serious blow to President Recep Tayyip Erdogan’s biggest political rival. Any sentence above two years risks a political ban. Imamoglu is expected to appeal the decision and the prison sentence won’t become effective until all legal means to contest it have been exhausted.

Ekrem Imamoglu Photographer: YASIN AKGUL/AFP

Twenty people were killed at an aid distribution site in Gaza run by an Israeli and US-backed organization, while talks for a ceasefire make little headway. The Gaza Humanitarian Foundation said 19 people died after being trampled during a “chaotic and dangerous surge” at an aid point in the southern city of Khan Younis. More than 800 Palestinians have died while trying to collect food parcels as of mid-July, with most of the deaths linked to sites run by the GHF, the UN said.

Sub-Saharan Africans boosted their savings at the fastest pace in more than a decade, driven by the growing impact of mobile money accounts across the continent. The share of adults in sub-Saharan Africa who saved through formal channels surged by 12 percentage points to 35% in 2024, the second-highest regional rate after East Asia and the Pacific, according to the World Bank’s Global Findex Database 2025. Africa’s young, tech-savvy population is increasingly using mobile phones to bridge gaps in services, including banking.