Through early 2025, the TRENDWISE HORIZON ENGINE—our forecasting model applied to trade and geopolitical strategy—had a solid track record. Although blindsided by abrupt U.S. trade aggression, it reacted quickly. It gave insightful reads on the dispute between the U.S. and Canada that were pretty useful, and even performed well amid quickly evolving dynamics between the U.S. and Europe. It flagged early indicators. It filtered out headline noise. It helped decision-makers see what was actually coming next.

Then came April 2.

The Trump administration announced blanket tariffs on 57 countries. Not industries—countries. The rationale? Unclear. Depending on the day, it was pitched as a way to raise revenue, gain negotiating leverage, bring back American manufacturing, or all of the above. Maybe none.

This frankly blew up our model, which builds scenarios off of defined rational assumptions. Data spiked in all directions.

The good news: We fixed it. The new version of TRENDWISE can accommodate more ambiguity in trade disputes when internal politics and economic urgency overlap. The reality is countries are navigating multiple audiences at once—voters at home, partners abroad, and rivals circling nearby.

The bad news: Industries should stand by for heavy rolls through at least 2025. Today’s briefing is updated with the last 12 hours of news (9 a.m. CT on 4/16/2025) and is the first field test of the rebuilt model, applied to one of the most complex dynamics on the global stage: the triangular friction among the United States, China, and the European Union.

The short version?
Yes, we expect some sector-specific deals this year—electric vehicles, critical minerals, LNG. No, we don’t expect broad realignment. Yes, volatility is here to stay. And no, trust isn’t coming back anytime soon.

The good news is we’ve now got a sharper tool to navigate it. The bad news? If you’re in a boardroom—or a supply chain—buckle up.

TRENDWISE Forecast: Narrow Deals, Broad Mistrust

The updated TRENDWISE model anticipates that the U.S., China, and the EU will reach a handful of focused trade agreements in 2025—mostly around sectors where interests overlap or pressure points are high. These include:

• An EU–China arrangement on minimum pricing for electric vehicles, aimed at preventing market flooding while avoiding escalation.

• LNG supply deals and shared industrial monitoring efforts between the U.S. and EU, particularly around steel and clean tech inputs.

• Semiconductor carve-outs and critical mineral access agreements between the U.S. and China, developed outside formal summits.

These are not signs of thawing relations. They are tactical decisions made under pressure, in a broader atmosphere of economic nationalism, industrial transformation, and public skepticism. All three players are operating from what they view as their dominant strategy—the most advantageous move based on current risks and available information. And none are inclined to back away from that stance.

What’s Being Said vs. What’s Really Happening

The public discourse is loud and dramatic:

• The U.S. has imposed tariffs as high as 145% on Chinese EVs and clean energy goods.

• The EU has responded with 35.3% tariffs of its own while bracing for U.S. auto and metals duties.

• China has called for global opposition to “U.S. coercion” and has linked trade retaliation to its geopolitical grievances.

• Meanwhile, Brussels is navigating its usual balancing act: maintaining cohesion among EU member states while sustaining relationships with both Beijing and Washington.

This noise matters—but not as much as what’s happening beneath the surface.

Beneath the Rhetoric: What Each Party Really Wants

When you peel away the slogans and speeches, the underlying interests come into focus.

For the United States, the goal is to contain China’s technological and manufacturing momentum. Trade is being used as a lever to maintain dominance in key sectors like semiconductors, clean energy, and pharmaceuticals. At the same time, Washington is under pressure to bring jobs home and shrink the trade deficit.

For the European Union, the top concern is avoiding a recession. European policymakers need to protect their auto and steel sectors from a flood of Chinese goods, while also preserving access to both Chinese and American export markets. This is a delicate balancing act that plays out differently in Berlin, Paris, and Brussels.

China, meanwhile, is trying to hold the line. Economic growth has slowed, and exports remain the engine of stability. Preserving its subsidy-driven industrial model is seen as critical to social stability. But Beijing also recognizes that it must avoid isolation and maintain access to the EU—particularly as the U.S. market becomes increasingly difficult.

Diverging Priorities, Shared Pressure

Each player’s strategic priorities follow their own internal pressures.

• The U.S. is focused on tech leadership, trade imbalances, and the optics of reshoring jobs.

• The EU is working to protect key sectors and manage external relationships without provoking either of its two largest trading partners.

• China is looking for economic stability without giving up control of its industrial model.

Because these priorities are so distinct, and in some cases directly opposed, the potential for broad, multilateral agreement remains low.

Signals of Possible Agreement

Still, there are signs that narrow deals are forming.

• The EU and China are actively discussing minimum price frameworks for EVs, a practical workaround to the current tariff standoff.

• The U.S. and EU are making progress on LNG trade and industrial overcapacity monitoring, particularly in response to Chinese steel exports.

• China has resumed certain agricultural imports from Europe and appointed a trade envoy with a background in U.S. negotiations—both quiet signals of a shift in posture.

• In the U.S.–China relationship, signs of backchannel cooperation are visible in areas like semiconductor supply chains and rare earth access.

These moves won’t fix the broader lack of trust—but they may reduce the odds of open trade war escalation.

Key Early Indicators: What to Watch Next

The TRENDWISE model is watching six key signals to gauge future direction:

1. EU Adopts Minimum Pricing for EVs
   Would indicate a shift from confrontation to pragmatism—and help stabilize the EU–China trade channel.

2. China’s Quarterly GDP Falls Below 4%
   Suggests mounting domestic pressure in Beijing to compromise and avoid broader export collapse.

3. U.S. Raises Clean Energy Tariffs Above 200%
   Would point to deepening political pressure at home and declining interest in diplomatic solutions—especially in climate-linked industries.

4. EU Extends Its Tariff Pause Beyond July
   Signifies an appetite for continued engagement, even if no long-term deal is yet in place.

5. Joint U.S.–EU Statement on Chinese Overcapacity
   Indicates rising transatlantic alignment and shared strategic framing, likely to increase pressure on China.

6. China Resumes More Agricultural or Tech Imports
   A sign of tactical de-escalation—especially important for European and U.S. exporters looking for stability.

Conclusion: Complexity Is the Default

The post-April 2 trade environment is not a clean story. It’s a tangle of public performance, domestic agendas, and selective cooperation. The U.S., China, and Europe each have strategic objectives they are unwilling to trade away—at least not yet. That means full-scale agreement is off the table, and volatility remains the most likely through-line for the rest of 2025.

The TRENDWISE HORIZON ENGINE doesn’t offer certainty. What it does provide is clarity about what matters, what to watch, and what comes next. For global businesses, the key will be to stay alert, adapt quickly, and do well in a world where long-term trust is in short supply—and short-term deals are the only currency of progress.

If you’d like to pilot TRENDWISE with your company, drop us a line at TRENDWISE@growthinnovationstrategy.com.