As European Union leaders work through the consequences of their new trading arrangement with the US, they are confronting the bitter reality of just how far they have fallen.

The US and the EU will have zero tariffs on aircraft and their components, some chemicals, some generic drugs, some semiconductors, some agricultural products and essential raw materials. Alcoholic beverages are not included in the agreement. The 50% tariffs on steel and aluminum remain.

Euro bulls are facing the first big test of their conviction in the form of the European Union's U.S. trade deal, which has cast doubt on the durability of one of 2025's most popular trades.