ECB’s Villeroy Sees US Tariffs Having Little Inflation Impact, Growth Risks Remain

European Central Bank Governing Council member François Villeroy de Galhau said the recent increase in US import tariffs is unlikely to add to euro-area inflation, noting that the precise scope of the duties remains uncertain. He added that the euro’s appreciation is exerting a “significant disinflationary effect” on consumer prices. Villeroy reiterated that the balance of risks to economic growth in the currency bloc is still tilted to the downside. Fellow Governing Council member Olli Rehn echoed those concerns, saying he is increasingly worried about the growth outlook and that the ECB should take additional time before making further policy decisions.