The U.S.-EU trade war has escalated as President Donald Trump announces a 200% tariff on European alcohol imports, responding to the EU's 50% tariff on American whiskey. Trump criticized the EU's trade practices on social media, calling it "one of the most hostile and abusive taxing and tariffing authorities in the world."

Market Impact:

• S&P 500 falls into correction territory
• European wine and spirits companies' stocks plummet
• U.S. wine producers anticipate increased domestic sales
• Restaurant owners and distributors express concerns over menu pricing

The hospitality industry, which relies heavily on European imports, faces significant challenges as they may need to restructure their offerings or increase consumer prices.

European Response:

• EU expected to expand retaliatory tariffs beyond whiskey
• Potential targets include bourbon, dairy, and tech products
• French President Macron warns against trade bullying
• European Commission preparing countertariffs

Consumer Impact:

• Double or triple prices on European imports
• High-end wine collectors and champagne enthusiasts most affected
• Price increases expected in bars and restaurants
• American whiskey producers call for resolution

Trade experts warn of a potential full-scale economic confrontation between the U.S. and EU, with lasting implications for industries, markets, and consumers globally. Both sides maintain firm positions, suggesting continued escalation of trade tensions.

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