European Central Bank President Christine Lagarde has warned that newly introduced tariff measures could exert modest upward pressure on inflation across the eurozone, highlighting growing concerns over external economic shocks.
Tariff Shifts and Inflation Outlook
In her recent remarks, Lagarde noted that while inflation has cooled from recent highs, fresh trade barriers and tariffs could reignite price pressures. Rising import costs, especially in energy, industrial inputs, and select consumer goods, may gradually feed into broader price indices.
- New tariffs may lead to higher prices for imported goods
- Business cost increases could be passed on to consumers
- Supply chain adjustments may prolong inflationary effects
Central Bank Stands Guard
Lagarde emphasized the ECB's readiness to adapt its policy stance as needed. While the bank remains cautious about overreacting to short-term data, it will closely monitor underlying inflation trends and market expectations.
Economists suggest that escalating global trade tensions could force a reassessment of the ECB’s rate-cutting trajectory to safeguard medium-term price stability.