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EU–India trade: Long-run opportunity for Euro area – Danske Bank

Danske Bank analysts highlight the newly finalised EU–India trade agreement, which will remove tariffs on over 90% of traded goods within seven years. India currently represents just 1.5% of Euro area exports but is projected to grow around 6.5% annually to 2030.

🔗 Source

💡 DMK Insight

The EU-India trade deal is a game changer for Eurozone exporters looking to tap into India’s growing market. Removing tariffs on over 90% of goods will likely boost Euro area exports significantly, especially as India’s economy is projected to grow at 6.5% annually until 2030. Traders should keep an eye on sectors like machinery and pharmaceuticals, which could see increased demand. This agreement not only enhances trade relations but could also impact currency pairs like EUR/INR, potentially strengthening the euro as trade volumes rise. However, it’s worth questioning whether this growth is already priced in. If the euro strengthens too quickly, it might hurt export competitiveness in the short term. Watch for any volatility in the EUR/INR pair, especially around key economic data releases from both regions. The real opportunity lies in identifying which sectors will benefit most and positioning accordingly before the market fully reacts.

📮 Takeaway

Monitor the EUR/INR pair for volatility as the EU-India trade deal unfolds, especially around economic data releases.

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