Escalating Trade Tensions Pose Risks to Global and European Economies

Luis de Guindos, Vice President of the European Central Bank (ECB), issued a stark warning on Friday about the potential negative impacts of escalating trade tensions, particularly new US tariffs, on both the global and European economies.

Protectionist Policies Could Undermine Growth

De Guindos emphasized that a trade war would be extremely detrimental to economic growth. He pointed out that the protectionist policies of the new US administration could have far-reaching effects on banking and fiscal policies across Europe.

Unprecedented Uncertainty in the Eurozone

The ECB Vice President also highlighted the high level of uncertainty facing the eurozone, describing it as the most significant since the pandemic. This uncertainty, coupled with weakened consumer confidence and sluggish growth, complicates the prospects for a swift economic recovery.