European goods have become around 30 per cent more expensive for US consumers over the past year.
That is following the introduction of new US tariffs on European Union products and a weaker US dollar, according to a study by Belgian bank BNP Paribas Fortis.
The increase is an average for European goods sold in the US and varies strongly by product.
“This is an average for European products, as some are subjected to higher tariffs than others,” said Koen De Leus , chief economist at BNP Paribas Fortis.
Some goods, such as steel and certain derivatives are subject to tariffs of up to 50 per cent. Most European products, though, face tariffs of around 15 per cent.
On top of the tariffs, the euro has strengthened by about 15 per cent against the dollar. De Leus said most products are “subject to 15 per cent tariffs with, on top of that, an appreciation of the euro of around 15 per cent”.
Combined, these two effects explain most of the price increase faced by US buyers. “It is roughly that: 100 plus 15 per cent import tariffs plus 15 per cent appreciation,” De Leus said, adding that a European product that cost $100 (€85) last year now effectively costs around $130 (€110).
Not all of this increase is necessarily passed on to consumers. “Exporters can reduce prices, but then they have to lower their margins,” De Leus said, adding that the same applies to US importers.
As a result, he noted, the 30 per cent increase “can be lower for many products, at the expense of the margin of the European exporter or the American importer”.
Until recently, the higher prices had not led to a noticeable decline in US imports of European goods. According to De Leus, there was “strong anticipation during the first quarter”.
More recently, though, exports have begun to face greater difficulties. “Thirty percent more expensive is not something you can make disappear in one, two or three steps,” he said.
At the same time, the dollar has weakened not only against the euro but also against other major currencies.
He linked this to a loss of confidence following what he referred to as “Liberation Day” or “Catastrophe Day,” adding that it has damaged trust in the dollar as a reserve currency.
“Trust comes on foot but leaves on horseback,” he said, adding that this would not disappear quickly, regardless of who occupies the White House.
The price increase comes as inflation in the US remains above the Federal Reserve’s 2 per cent target.
According to the BBC, US inflation stood at 3 per cent in September, unchanged from January. While this is well below the peak of 9.1 per cent reached when the US faced its worst inflation in four decades, overall prices have risen by around 25 per cent over the past five years.
Consumer confidence fell in November to its lowest level since the spring, even as stock markets remain close to record highs and the economy is expected to grow by 1.9 per cent this year, slower than last year but better than expected.
Prices, though, are not falling but rising at a slower pace. Against that backdrop, prices for goods imported from the EU have increased even more sharply.
A recent study by Spanish bank CaixaBank estimates that the average tariff applied to EU goods entering the US has risen to around 12 per cent, compared with around 1 per cent in 2024. In response, European exporters are increasingly adopting mitigation strategies.
These include investing directly in the US or redirecting exports to other markets. According to the study, goods previously sold in the US are most likely to be diverted to countries with a similar export structure, such as Canada, Australia, Japan, the UK and New Zealand.
Some Latin American economies, including Brazil and Colombia, are also potential destinations.
Meanwhile, the November report from US-based Peterson Institute for International Economics (PIIE) show that, after the US tariffs “aimed at reducing imports and these steps were accompanied by other policies designed to spur exports … imports surged in the first half of 2025, whereas exports declined in the same period”.
The European American Chamber of Commerce published a report yesterday, stating that “48 per cent of EU firms now see tariffs as an obstacle to trade” but only “18 per cent, sees tariffs as a major obstacle to trade”, which contrasts with the US, where “over 75 per cent of firms say tariffs are an obstacle, and as many as 39 per cent cite it as a major barrier”, using figures from the latest European Investment Bank survey.
About rethinking export destinations, “7 per cent of EU firms reduced imports” and “19 per cent have started to diversify the countries from which they import”, the report says.
US companies have started to “substitute imports”, as the report also states that close to a third of US companies surveyed are cutting imports, though not specified if this is about European imports specifically, and roughly 40 per cent declared “switching countries”.
