EU trade ministers are joined virtually by U.S. Trade Representative Katherine Tai today as the two sides set about trying to roll back some of the tariffs enacted during the Trump presidency. The 27 ministers will reiterate the importance of the bloc’s relationship with the U.S. and pledge to resolve outstanding disputes, according to a copy of the draft conclusions seen by Bloomberg. Some progress was already made this week, when the bloc hit the pause button on a planned tariff hike on American goods that was set to go into force next month. If all goes according to plan, the two sides might now negotiate in a less tense atmosphere and find a middle ground before the end of the year. That will give bourbon drinkers and Harley Davidson riders in Europe something to celebrate at least. - Richard Bravo and John Ainger

What’s Happening

Bolstering Berlin | In a sign of easing transatlantic ties, the Biden administration said stopping the Nord Stream 2 gas pipeline from Russia is a long shot, a shift in tone that came as the U.S. held off on sanctioning the Switzerland-based company overseeing its construction. The move was meant to bolster ties with Berlin and encourage Germany to consider the U.S.’s concerns about Russian influence.

Iran Deal | Iran and the U.S. are close to a deal that will revive the 2015 nuclear accord, according to a top EU official on the sidelines of the latest round of talks in Vienna. It follows similar optimism from Russian officials and represents the clearest sign yet of major progress toward ending the confrontation.

Covid Passes | Negotiators representing the EU Parliament and the bloc’s governments will have another go today at reaching an agreement over the Covid certificates that are meant to ease travel for those inoculated within Europe. Governments struck a deal yesterday over allowing travel from outside the EU, and we now await the “white list” of countries whose residents won’t even need jabs to visit.

Job Crunch | The labor shortage that’s hitting the U.S. as the nation rebounds from the pandemic is also coming to Europe, where it could prove even more difficult to fix. In the short term, coronavirus travel restrictions mean workers can’t cross borders as easily as usual within the 27-nation bloc. But the problems also run a lot deeper. 

Status Anxiety | The European Central Bank is warning that high debt burdens and “market exuberance” are creating risks to financial stability as the euro area emerges from the pandemic. Echoing former Federal Reserve Chair Alan Greenspan’s warnings over the dot-com bubble in the 90s, it highlights concerns that the flood of economic support is building up dangerous imbalances.

In Case You Missed It

VaVa Voom | New car sales in Europe soared by a whopping 256% in April, highlighting the bounce back from the coronavirus nadir last year. Demand still came up short of pre-pandemic levels, while manufacturers are now focusing on supply concerns amid a global shortage of semiconductors.

Ryanair Win | Ryanair notched up the first wins in its campaign to block billions of euros of Covid-19 bailouts for rival carriers after EU judges faulted regulators for failing to properly check whether aid was justified. The company has filed more than two dozen challenges to approvals for pandemic aid doled out by governments to carriers, including Lufthansa and Air France.

Merkel’s Loss | Chancellor Angela Merkel’s families minister stepped down amid allegations she plagiarized parts of her doctoral dissertation, disrupting the government’s makeup just four months before national elections. Franziska Giffey, who is from the coalition partner SPD, says she will focus on her campaign to become Berlin’s mayor.

Bitcoin Bursting | Crypto assets shouldn’t be seen as a “real investment” because their underlying value is hard to discern, and market participants should brace for more price swings, ECB Vice President Luis de Guindos warned. It turned out to be prescient, with Bitcoin’s value plunging and then rallying yesterday.

Sniff Test | And finally, a French study has found that dogs’ detection of Covid-19 is almost as effective as getting a PCR test. Canine detection reached 97%, beating many 15-minute antigen tests.

Chart of the Day

The most important geopolitical project you’ve probably never heard of is called the Three Seas Initiative. It’s a joint endeavor by 12 eastern EU members to update the physical and digital links between the Baltic, Adriatic and Black Seas. That makes good sense in its own right. But the kicker is that this undertaking may be Europe’s best answer to the encroachments of Russia and China, according to Bloomberg Opinion’s Andreas Kluth.

Today’s Agenda (All times CET.)

• 9 a.m. EU trade ministers meet in Brussels
• 10 a.m. EU health ministers hold video call on vaccinations
• 11 a.m. Ngozi Okonjo-Iweala, director-general of the World Trade Organization, joins the European Parliament trade committee for a discussion
• Former French President Nicolas Sarkozy is back in court on charges he illegally exceeded campaign-spending limits ahead of his 2012 electoral defeat