① The European Central Bank Governing Council member Villeroy stated that Trump's threat of tariffs brings uncertainty to the Global economy, and protectionism will only slow economic growth and intensify inflation; ② However, Villeroy pointed out that the inflation level in the Eurozone is in a downward trend, and the European Central Bank has room for gradual interest rate cuts, with no recession risk in Europe; ③ ECB policymakers have recently become increasingly confident in the ECB's interest rate cut in June.
According to a report from Caixin on April 28 (edited by Zhou Ziyi), ECB Governing Council member and Bank of France Governor Villeroy stated on Monday (April 27) that President Donald Trump's threat of tariffs brings uncertainty to economies around the world, but as inflation levels in the Eurozone decline, Europe still has room for further interest rate cuts.
In an interview, Villeroy pointed out, "We are in a very uncertain moment... Trump's administration's policies are detrimental to the US economy, and unfortunately also to the world economy."
He also added, "Trade protectionism does not work; it means slowing growth and worsening inflation."
Villeroy reiterated that with inflation continuing to decline, he believes there is no recession risk in Europe, and stated, "We still have room for gradual interest rate cuts."
At the recent spring meetings of the International Monetary Fund and the World Bank, ECB policymakers have become increasingly confident in the ECB's interest rate cut in June.
Data from the eurozone shows that business growth in the euro area has stagnated this month, wage growth has significantly slowed, and inflation in Europe continues to decrease, creating conditions for an interest rate cut.
Despite the significant increase in confidence within the ECB regarding the interest rate cut in June, officials are not prepared to make a substantial cut, as they believe that a 50 basis point cut would trigger unnecessary speculation in the market.
They also emphasized that they remain open to the possibility of a rate cut in June, as there is still more than a month until the meeting, and Trump's erratic policy attitude may make the economy unpredictable in the future.
