Trump's Tariff Storm: ECB Faces Interest Rate Dilemma Amid Growth Fears

The European Central Bank is expected to cut interest rates for the seventh time due to ongoing economic concerns fueled by US President Trump’s tariff proposals. Despite a brief suspension, uncertainty in tariff rates could hinder economic growth and affect Europe's trade, particularly its auto industry.

The European Central Bank is poised to cut interest rates once again, driven by fears of sluggish economic growth exacerbated by US President Donald Trump's aggressive tariff strategy.

After last month's hint at a potential pause in rate cuts by ECB President Christine Lagarde, Trump's unexpected tariff hike proposals have instead pushed the bank towards more rate cuts. This Thursday, the bank is likely to announce a quarter-point reduction.

Although inflation has been tamed, the looming tariffs threaten Europe's fragile economic recovery, particularly unsettling its vital trade relations with the US. With key sectors like the auto industry vulnerable, the markets are on edge, awaiting the bank's next move.

(With inputs from agencies.)