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(Bloomberg) -- The latest 10% tariff threatened by President Donald Trump is likely to shave off about 0.1% from the euro area’s gross domestic product, according to Goldman Sachs Group Inc. economists.

Trump said on Saturday he would impose the levies on European countries that have rallied to support Greenland in the face of US threats to seize the semi-autonomous Danish territory. That would apply to Denmark, Norway, Sweden, France, Germany, Finland, the UK and the Netherlands.

The Goldman team estimates that a 10% duty would lower real GDP by 0.1% to 0.2% across the affected countries via reduced trade. Germany would face the biggest hit at about 0.2% if it’s an incremental reciprocal tariff and 0.3% if it’s a blanket levy, they said.

“The hit could be larger should there be adverse confidence or financial market effects,” the team including Sven Jari Stehn wrote in a note.

Global financial markets have been roiled by the escalation in trade tensions, with European stocks and US index futures sliding and havens such as gold rallying on Monday. Still, a slate of strategists said the impact on European equities is likely to be short-lived as the economic outlook remains resilient.

The Goldman economists said while it was “highly uncertain” if the tariffs would be implemented, an EU response could range from stalling the US trade deal, imposing counter-levies or launching the so-called anti-coercion instrument. They expect the UK to focus on engaging diplomatically with Trump, similar to trade negotiations last year.

The EU is in talks to potentially impose tariffs on €93 billion ($108 billion) of US goods, and is also weighing additional countermeasures beyond the tariffs but will first try to find a diplomatic solution, according to people familiar with the discussions.

The Goldman economists also see a “very small” impact on inflation and they expect central banks would lower interest rates in response to the GDP outlook.