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The ECB warned that a trade war with tariffs would further weaken Europe's already anaemic economy. The bank noted Europe's reliance on foreign trade and its industrial recession, which is driven by high energy costs and weak Chinese demand.
It also warned that retaliation is likely.
Expected retaliatory tariffs could cut transatlantic and Chinese trade flows, reducing demand for imported feed ingredients and pressuring export-linked prices.
reuters.comHarry RobertsonNov 6, 2024After 23 past trade events, Euro (USD per EUR) moved a median -0.4% over 5 sessions (43% higher; middle half -0.9% to +0.7%), and +0.5% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
The ECB's warning that a trade war would hurt the euro-area economy supports a weaker-growth, lower-rates narrative that is negative for the euro.
