Trade Tensions and Economic Outlook

European Central Bank (ECB) Vice President Luis de Guindos has issued a stark warning about the potential negative impacts of escalating trade tensions, particularly new US tariffs, on both the global and European economies. Speaking on the economic outlook, De Guindos emphasized that a trade war would be "very negative" for growth, pointing out that protectionist policies from the new US administration could have far-reaching effects on banking and fiscal policies.

Unprecedented Uncertainty in the Eurozone

De Guindos also highlighted the unprecedented level of uncertainty currently facing the eurozone, which he described as the highest since the pandemic. This uncertainty, combined with weakened consumer confidence and sluggish growth, further complicates the prospects for recovery in the region.