HomeEconomyAfter the reduction of 7 at the consecutive rate, the ECB takes...

After the reduction of 7 at the consecutive rate, the ECB takes a break while waiting for the result of Trump’s customs tasks

The European Central Bank has decided to opt for the monetary status quo this Thursday, while Europe and American are about to conclude an agreement on customs tasks.

As expected, the European Central Bank maintained its interest rates without changes on Thursday, to take the time to evaluate imminent decisions in the commercial show between Washington and Europeans.

A monetary status quo that ends a series of rates falls, since last September, when the ECB had decided to gradually reduce the cost of credit to support the decrease in inflation.

The rhythm of the increase in consumer prices has now stabilized around the 2% target established by the Central Bank, after reaching record levels due to the COVID-19 pandemic and the large-scale invasion of Ukraine by Russia.

But these more favorable monetary conditions seem fragile, while Donald Trump threatens to eliminate European exports to the tasks of punitive customs of the United States from 30% since August 1.

An agreement at the sight

However, a commercial agreement between the EU and the United States seems to be arising. According to several European sources, the agreement establishes customs of 15% in European exports for the United States, with exemptions, particularly in aeronautics, spirits or certain medications.

After seven consecutive and eight falls in total since last June, the ECB has recovered its deposit rate, which refers to 2%, against a 4% peak reached in a complete inflationary wave. Inflation in the euro zone has been established exactly 2% in June and economic indicators, including the increase in industrial production, gave a rebirth of optimism with respect to the health of the economy.

But it is likely that the strengthening of commercial barriers will bring a new blow to the economy of the euro zone and encourage the ECB to consider the new rates fall after summer.

Author: Paul Louis with AFP
Source: BFM TV

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