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EU-US trade hits record high despite tariff tensions

Published: 22:28, July 4, 2026

Trade between the European Union and the United States reached a record high in 2025, showing how closely linked the two economies remain even during a difficult period for trade policy.

Goods trade across the Atlantic climbed to €875 billion, according to a new study by the German Economic Institute, known as IW. The figure was an all-time high. EU exports to the U.S. rose 7.7% to €580 billion, while EU imports from the U.S. increased 2.2% to €295 billion. That left the EU with a goods trade surplus of nearly €285 billion.  

At first sight, the numbers make the EU-U.S. trading relationship look very strong. However, the IW study said the headline figure does not tell the whole story. Some of the increase came from companies sending goods earlier than normal before tariffs took effect. This is known as front-loading. It can lift trade figures for a short time, but it does not always mean demand is stronger.  

Ireland was the main reason EU exports rose overall. Irish exports to the U.S. jumped 52.7% in 2025, helped by strong shipments of pharmaceutical and chemical products, many of which were largely protected from the tariff measures. Only five EU countries increased their goods exports to the U.S.: Ireland, Czechia, Italy, Denmark and Finland. Most EU member states recorded a fall.  

The car industry showed a very different picture. EU exports of cars and car parts to the U.S. fell 20.4% in 2025. Germany, which accounted for almost two-thirds of EU automotive exports to the U.S., recorded an 18.9% decline in this sector. This suggests that traditional manufacturing industries felt much more pressure from tariffs and uncertainty than some pharmaceutical exporters did.  

Services trade also reached a record level. Trade in services between the EU and the U.S. surpassed €865 billion in 2025. But this part of the relationship favoured the U.S. The EU ran a €178 billion deficit in services, meaning it bought far more services from the U.S. than it sold there. A large part of EU service imports from the U.S. came from intellectual property charges, including software licences, patents and trademarks.  

Taken together, the figures show that the EU and the U.S. remain deeply connected. Goods trade favours the EU, while services trade favours the U.S., making the overall relationship more balanced than the goods figures alone suggest.  

The main message from the IW study is simple: record trade does not mean there was no damage. Tariffs and uncertainty hurt parts of Europe’s manufacturing base, especially the automotive sector. At the same time, pharmaceutical exports and services helped keep the overall numbers high.

Christian Nordqvist Avatar

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