ECB Official Highlights Risks of US Tariffs on Eurozone Economy

Francois Villeroy de Galhau, a prominent member of the European Central Bank (ECB) Governing Council and Governor of the Bank of France, has issued a stark warning regarding the potential impact of the US administration's global tariffs on the Eurozone's economic growth. According to Villeroy, these measures could reduce the region's growth by a significant 0.25%.

Global Economy at Risk

In a revealing interview with Le Monde, Villeroy emphasized that the global economy stands to suffer from the ongoing trade war, with the United States likely to bear the brunt of the negative consequences. He pointed out that the imposition of tariffs is expected to drive up the prices of imported goods in the US, potentially leading to higher inflation rates.

Annual Letter to President Macron

Further elaborating on his concerns, Villeroy presented his annual letter to French President Emmanuel Macron. In it, he described the potential shock from the trade war as not "negligible," yet he reassured that it is unlikely to plunge the euro area into a recession. This statement offers a glimmer of hope amidst the looming economic uncertainties.