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Trump tariffs would test pricing power of Europe's luxury goods makers

The article from Reuters discusses the potential impact of former U.S. President Donald Trump's proposed tariffs on European luxury goods if he were to win the 2024 election. Trump has suggested a 10% tariff on all imports, which could significantly affect European luxury brands like LVMH, Kering, and Richemont, whose products are popular in the U.S. market. These tariffs could test the pricing power of these companies, as they might need to decide whether to absorb the cost, thereby reducing their margins, or pass it on to consumers, potentially affecting demand. The article highlights that while luxury goods often have inelastic demand, the extent to which these brands can maintain their pricing without losing market share remains uncertain. Additionally, the article notes that previous trade tensions under Trump's administration led to retaliatory tariffs from the EU, which could again complicate international trade relations.

Read the Full Reuters Article at:
[ https://www.reuters.com/business/retail-consumer/trump-tariffs-would-test-pricing-power-europes-luxury-goods-makers-2025-02-18/ ]