An escalatory spiral that leads towards Eurasia's 10% 'trade war' scenario, however, would prompt Brussels to deploy escalatory measures, such as "export controls/duties, public procurement curbs, and/or penalties on U.S. services exports" by using the ACI "trade bazooka as a last resort," they concluded.

President Trump’s threat to impose 30% tariffs on the European Union disrupted negotiations. From cars to wine, these are the industries on the line.

Trump said the U.S. will impose a 15% tariff on Japanese imports under the agreement, which he hailed as "maybe the largest deal in history."