The ECB warns of the “enormous impact” of possible Trump tariffs on the European economy

He calculates that “if a jurisdiction as important as the United States imposes 60% tariffs on any other major jurisdiction, I can assure you that the direct and indirect effects and trade diversions will be enormous.” Guindos rules out, however, an automatic reaction from the ECB. “If you ask me: are you going to react immediately? The answer is no,” he responded, adding that “what we will do is incorporate into our projections the trade policy announced by the new US administration and we will take into consideration all the elements.” to decide later.

In the new perspectives that the ECB will present in December, therefore, these effects on “trade policy, plus the evolution of demand, plus the evolution of energy prices” will not yet be contemplated. In any case, he has reiterated that those responsible for the ECB will continue to be guided by the data and will observe with special attention their bank loan survey to determine if financing conditions are restrictive.

Guindos was the first member of the ECB’s governing council to make statements after Donald Trump was declared the winner of the United States presidential election. Two weeks ago, however, the president of the ECB, Christine Lagardewent ahead and questioned Trump’s statements in which the then-candidate mocked the work of central banks. Trump had ridiculed the chairman of the US Federal Reserve, saying that he has “the best job in the government: you go into the office once a month and say ‘let’s flip a coin’ and everyone talks about you like you’re a God.” ». “You should go visit us,” Lagarde responded to those words, “I have thousands of hard-working people—economists, lawyers, computer scientists—and I can assure you that they work very hard every day, not just once a month. “They are extremely conscientious and determined to really do the best job possible to implement the right monetary policy and secure what is our common good: our currency.”