ECB Considers Interest Rate Cuts Amidst Global Economic Uncertainty

European Central Bank policymaker Francois Villeroy de Galhau observes that U.S. tariff policies have cast uncertainty over the global economy. Despite potential recession fears in the U.S., Europe faces no such risks, prompting considerations for future interest rate cuts to tackle declining inflation in the eurozone.

European Central Bank policymaker Francois Villeroy de Galhau has expressed concerns over the global economic uncertainty spurred by U.S. President Donald Trump's tariff threats, highlighting potential ramifications in the United States and the world economy.

Speaking to RTL Radio, Villeroy criticized Trump's policies, arguing they hinder economic growth and elevate inflation. Despite global uncertainties, Villeroy conveyed confidence in Europe's economic resilience, with no foreseeable recession risks as inflation trends downward.

In response to declining eurozone inflation, ECB officials are considering further interest rate cuts. However, substantial cuts lack support, with only modest adjustments likely as the ECB reduced its benchmark rate to 2.25% recently.

(With inputs from agencies.)