The U.S. and the European Union have officially finalized their Framework Agreement on Reciprocal, Fair, and Balanced trade, which is expected to significantly reshape their economic relationship. Key highlights of the pact include the elimination of EU tariffs on various goods, while both sides have agreed on a 15% tariff cap on cars and pharmaceuticals. Although Trump backed down from imposing a hefty 250% tariff on pharmaceuticals, high tariffs on European autos will remain until the EU moves to reduce its duties on U.S. goods. The agreement, which covers a wide range of sectors including energy and AI, marks a significant step toward rebalancing trade ties, although some issues, such as tariffs on wine and spirits, remain unresolved.