Former U.S. President Donald Trump has announced a proposed 50 percent tariff on goods imported from the European Union, set to take effect on June 1st. The announcement, made on his Truth Social platform, cites the EU’s trade practices as “unacceptable” and claims the bloc was “established with the primary purpose of exploiting the US in trade.”

According to Trump, the EU’s policies have resulted in a significant trade deficit for the United States. He stated that negotiations with the EU have been unproductive, leading him to recommend the substantial tariff.

An exception to the tariff will be made for products built or manufactured in the USA. These goods will be exempt from the 50 percent levy.

Experts suggest that Trump’s move may be a response to pressure from bond markets and concerns about U.S. public finances. According to Ulrik Bie, an economic editor, Trump is reverting to familiar tactics by issuing threats. Bie also notes that Trump has yet to finalize any of the trade agreements he previously claimed would be easily achieved.

Following Trump’s announcement, the Danish stock market experienced a downturn. The C25 index, which had been up by nearly 0.6 percent, fell by 1.8 percent shortly after the news broke.

Investment economist Per Hansen suggests that while the tariff may be a negotiating tactic, it is creating uncertainty among investors, leading to the decline in share prices. Hansen acknowledged that the tariff is unlikely to be implemented, but the market is still reacting to the uncertainty.