Read the 2026 Transatlantic Economy Report
The transatlantic economy – worth $9.8 trillion – is the world’s largest and most consequential economic relationship. Although it faces stormy seas in 2026, it does so with strong momentum following a year marked by all-time highs across a range of indicators.
The Transatlantic Economy in 2026
The transatlantic economy faces stormy seas in 2026, as countries and companies navigate geopolitical tensions, shifting global supply chains, disruptive trade policies, realigning currency movements, rising energy costs, and the transformative effects of AI. Yet, even in this context, transatlantic business continues to thrive. Every day, more than $6.4 billion worth of goods and services are traded between Europe and the United States, of which $4.5 billion (70%) is between the EU and the US, underpinned by extensive cross-border investments that support millions of jobs.
Economic growth on both sides of the pond is expected to be cyclically robust in 2026, thought the pace will vary. Analysts predict economic growth of 2.5% in the United States and around 1.2% in Europe, with significant variation across countries. In the United States, the massive AI infrastructure buildout and an affordability squeeze are key watchpoints; in Europe, higher energy prices, longstanding barriers inside the Single Market, and vulnerability to China’s export onslaught add to the uncertainty.
The bottom line is unchanged: the transatlantic economy is the world’s largest and most consequential economic relationship. Transatlantic commerce continues to thrive, and this dense web of deep connections remains a strength – not a burden – in a more competitive and disruptive age.
Key Findings:
- Executive Summary
- Chapter 1: STORMY SEAS: The transatlantic economy in 2026
- Chapter 2: THE TIES THAT BIND: The transatlantic economy
- Chapter 3: CONCLUSION: Do Europe and America Still Need Each Other?
Conclusion
In a transatlantic climate marked by trade tensions and questions about the strength of the security partnership, a growing chorus of voices argues that the other side of the Atlantic has become more problem than solution. Some Americans talk as if the United States has little need for Europe; some Europeans say it is time to ‘de-risk’ and become ‘autonomous’ from America.
In fact, there is substantial evidence that Europe and the United States each gain considerably from a flourishing transatlantic economy. Some Europeans are right to want to mitigate excessive dependencies, but wrong to think decoupling from America would cost little; some Americans are right to want Europeans to do more on security, but wrong to think they don’t need Europe.
Europe and America are constituent parts of a densely intertwined $9.8 trillion transatlantic economy and members of the most successful alliance in history – each indispensable to the other. European and American companies not only profit from those interconnections; they use the transatlantic economy as a common geoeconomic base to compete in a fractious world.
About the Authors
Research for the study was conducted by Daniel Hamilton, Senior Fellow at the Foreign Policy Institute of Johns Hopkins University’s Paul H. Nitze School of Advanced International Studies, and Joseph Quinlan, Senior Fellow at the Transatlantic Leadership Network.