pushes

Published on
28/09/2026 – 12:25 GMT+2

Brussels and Beijing are fighting over quotas that would limit Chinese imports to the EU market, as the Europeans seek to rebalance their trade relationship with China, Euronews has learned.

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Both started intense negotiations last June over EU and Chinese access to each other’s markets, with an October deadline set by the European Commission to reach “tanglible” results. However, China is pushing hard against the EU’s attempts to protect its market.

According to one person familiar with the matter, the Commission, which is negotiating on behalf of the 27 EU countries on trade issues, wants China to accept quotas on specific products.

However, it is unclear how China would accept and respect such quotas.

Trade defence mechanisms delayed

According to media reports, so-called “voluntary export restrictions” have been pushed by the Commission for electric vehicles. But Beijing’s trade minister rejected them in a statement earlier this month.

If China accepted such a system of restrictions, it would mean that it voluntarily limits its exports to the EU on the basis of a deal negotiated with the Commission, sparing the EU from adopting defensive trade measures that might be seen as an aggressive move by China.

Technical negotiations are in their final stretch as the October deadline is approaching.

Director General of DG Trade at the Commission, Ditte Juul Jørgensen, travelled to China last week for two days of heated discussions, and EU Trade Commissioner Maroš Šefčovič is due to be in Beijing on 8 and 9 October for political talks, ahead of a key meeting of EU leaders in Brussels.

To give negotiations a chance, the Commission has delayed the adoption of trade defence mechanisms aiming to protect the EU chemical industry, according to another person familiar with the matter. The chemical industry is one of the sectors most threatened by Chinese competition in the EU.

However, the threat also targets other sectors, making the rebalancing of the trade relationship “existential” for the Europeans, EU Industry and Trade Commissioner Stéphane Séjourné told Euronews last week.

According to the Commission, the EU already lost 250,000 industrial jobs last year, particularly concentrated in energy-intensive sectors and automotive supply chains.

President Trump came to battleground North Carolina doubling down on a tantalizing and implausible midterm promise. “If we win,” he said, “we’re going to get you $5,000. So that’s it. Very simple.”

The Republican candidates who spoke at the rally had nothing to say about it.

Their silence reflects a broader pattern. About a week after the president unveiled his “Trump dividend” pledge at the party’s unusual midterm convention in Dallas, there is little evidence that Republicans in competitive races have incorporated it into their campaigns.

The pledge hasn’t been a staple of television advertising, whether from Trump’s own political operation or his party’s candidates. It usually only comes up when reporters ask about it, prompting most Republicans to sidestep the idea.

The Republican National Committee considers the proposed payments part of Trump’s broader economic vision and says candidates should get behind it.

“Of course we encourage all Republican candidates to run on his agenda, and that includes efforts to put more money in the pockets of the American people,” spokesperson Natalie Baldassarre said.

There are some exceptions. Republican Rep. Derrick Van Orden, who is seeking reelection in a battleground Wisconsin district, has praised the proposal.

The idea comes as the economy confronts rising interest rates, continuing inflation and climbing fuel costs. Republicans are fighting to keep their majorities in the House and Senate.

Trump previously promised to use savings from his White House advisory team, which he calls the Department of Government Efficiency, or DOGE, and revenue from tariffs on imports to distribute payments of $2,000 or more, but none of that came to pass. The president has said he did not think congressional approval would be needed for the idea, which could cost more than $1 trillion, but House Speaker Mike Johnson (R-La.) indicated the promise would require lawmakers to act.

Democrats point to those previous suggestions for a payout to raise skepticism about the $5,000 pledge.

“This idea is nothing more than a recycled broken promise that voters know Republicans will never deliver,” said Viet Shelton, a spokesperson for the House Democratic campaign arm.

Republican campaign advertising has largely focused on the One Big Beautiful Bill Act, including provisions that temporarily cut taxes on tips and overtime. Other candidates are concentrating on local issues or attacks against their opponents.

Doug Heye, a Republican strategist and former Republican National Committee communications director, said there is little mystery about why candidates have been reluctant to embrace the pledge.

“It’s a dumb idea,” Heye said. “There’s no way to pay for it and it would spike inflation.”

Catalini writes for the Associated Press.

Frankfurt has tightened again.

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The European Central Bank’s governing council lifted the deposit facility rate from 2.25% to 2.5% on Thursday. It is the second hike since 11 June, when the ECB moved for the first time in three years.

The ECB sets monetary policy for the eurozone through three key interest rates, with the deposit facility rate serving as its main policy benchmark.

The main refinancing rate was lifted to 2.65% and the marginal lending facility to 2.9%.

In its statement, the central bank noted that “the conflict in the Middle East continues to generate inflation pressures, and inflation is set to remain well above target for an extended period,” while ensuring that “with today’s decision, the Governing Council remains well positioned to navigate the uncertainty caused by the conflict.”

The ECB staff projections continue to estimate that headline inflation will average 3% this year. However, it has revised up the expectations for 2027 and 2028 to 2.5% and 2.1% respectively, compared with June.

An energy problem, not a demand problem

The decision follows an August inflation reading of 3.3%, up from 2.9% in July and the highest since September 2023.

Energy costs did nearly all the work, with energy inflation jumping to 14.3% from 10.3%, as fighting around the Strait of Hormuz kept crude supply constrained. The problem persists as Brent crude crossed $100 a barrel again on Wednesday due to renewed exchanges of fire between the US and Iran.

Underneath, the picture is calmer.

Core inflation, which strips out energy, food, alcohol and tobacco, actually fell to 2.4% from 2.5% in August, while services inflation, the component most sensitive to wages, dropped to 3% from 3.3%. There is still little sign that expensive energy is spreading into the rest of the economy.

That distinction has been central to the ECB’s own thinking.

In a paper published earlier this month, its economists found that adverse energy supply factors accounted for around 90% of the rise in energy inflation between January and May of this year.

“This time the energy supply shock dominates, while demand and public policy stimulus have minor roles,” the economists wrote, contrasting it with the 2021-22 surge that prompted a far more aggressive response.

A single rate for very different economies

The eurozone inflation average conceals a wide spread.

August inflation ran at 4.5% in Spain, 2.9% in Germany and 2.7% in France, three economies facing the same energy shock with markedly different outcomes.

Growth complicates matters further.

The bloc has held up better than expected, but resilience is not overheating, and even at 2.5% the deposit rate remains within the range the ECB considers neutral. Going further would mean deciding that policy must actively restrain the economy.

Christine Lagarde had signalled this move in July, when the council held rates but instructed staff to model oil and gas scenarios ahead of September.

“The burden of proof is on data,” Lagarde said then, adding that “the full inflationary impact of the energy shock has yet to play out.”

Thursday’s decision comes alongside fresh staff projections, though their cut-off date falls roughly two weeks before the meeting, meaning neither the latest leg higher in oil nor the surge in European government bond yields to 15-year highs will be reflected.

Attention now turns to Frankfurt’s peers.

The Federal Reserve will announce on 16 September and the Bank of Japan on the 18, with both expected to consider hikes of their own.

Meanwhile, the Bank of England will decide on 17 September and is expected to hold rates as it currently maintains a much higher benchmark than the rest at 3.75%.