The US and EU are racing to lock in the final details of their major new trade deal before Friday's deadline. Critics say its a rushed fix, with German Chancellor Friedrich Merz calling the outcome unsatisfying and France’s Bayrou dubbing the EU’s "submission" a "dark day.

The economy was supposed to crumble. The trade war was expected to escalate out of control. Markets were forecast to plunge. None of that has happened. But Trump’s early trade victory may be short-lived.

TRUMP'S U.K. TRIP: President Donald Trump will return to Washington today after meeting with British Prime Minister Keir Starmer to discuss trade and the humanitarian crisis in Gaza and reaching a trade agreement with the European Union.

The United States and the European Union agreed on a framework trade deal to end months of uncertainty for industries and consumers.

President Trump has achieved the remarkable: raising tariffs by more than the notorious Smoot-Hawley Tariff Act of 1930, while—it appears—avoiding the destructive trade war that followed.Including the deal struck over the weekend with the European Union,

Tariffs, including the 15% rate for most imports from the EU, would raise consumer prices by 1.8% in the short run, according to the Yale Budget Lab.

U.S. President Donald Trump will make his trade deal decisions this week even as separate negotiations with China and the European Union continue, U.S. Commerce chief Howard Lutnick said on Tuesday ahead of Trump's self-imposed Aug.

The Trump administration touts tariffs as part of a wider set of "America First economic policies," which have "sparked trillions of dollars in new investment in U.S. manufacturing, technology, and infrastructure," according to the White House's website.

France and Germany have warned about the economic fallout from the 15 percent tariffs European goods face in the U.S.

U.S. senators from both major parties plan to introduce bills this week targeting China over its treatment of minority groups, dissidents and Taiwan, emphasizing security and human rights as President Donald Trump focuses on trade with Beijing.

"We still believe the most likely outcome is slow growth and firm inflation: Not a recession, but a backdrop where the adverse effects of trade and immigration controls on growth outweigh the boost from deregulation and fiscal largesse," Morgan Stanley strategist Michael Zezas wrote.