Europe's economic optimism is threatened by Donald Trump's proposed 30% tariff on EU exports, raising fears of a trade war. Goldman Sachs predicts a potential 1.2% decline in Eurozone GDP if tariffs are implemented. Despite this, the EU is currently refraining from countermeasures while preparing for possible retaliation. The euro has strengthened significantly, and investor sentiment remains bullish, but risks loom if tariffs are enacted.