UBS CEO Sergio Ermotti Highlights Potential Impact of Tariffs on Interest Rates

In a recent interview with CNBC at Davos, UBS Group AG CEO Sergio Ermotti expressed concerns over the potential effects of tariffs, including those proposed by U.S. President Donald Trump, on the trajectory of interest rates. Ermotti suggested that such tariffs could slow down the decline in interest rates by making inflation more persistent.

"Inflation is proving to be much more stubborn than anticipated," Ermotti stated. He further elaborated that tariffs might not effectively reduce inflation, thereby preventing interest rates from decreasing as rapidly as some might expect. Additionally, Ermotti pointed out that these tariffs could exacerbate geopolitical tensions, adding another layer of complexity to the global economic landscape.