The European Central Bank warned that a rise in trade protectionism would undermine the global economy, and said the U.S. would be among the worst-affected.
The cautionary comments coincide with data showing factory orders in Germany unexpectedly slid for a third month in March, another sign of the weakness that’s dogged the euro-area economy since the start of the year. Separate reports showed investor confidence in the currency bloc fell for a fourth month and a retail gauge suggested that sales contracted for the first time in more than a year.
The ECB has cited tariffs as one of its chief concerns as the institution’s policy makers edge toward the end of their stimulus programs. President Mario Draghi has warned that while the impact of already-adopted protectionist measures is limited, the prospect alone of trade war between the U.S. and China -- two of the bloc’s biggest trading partners -- could damage confidence and reduce consumption and investment.
“In a scenario in which the U.S. increases tariffs markedly on imported goods from all trading partners that retaliate symmetrically against it, the outcome for the world economy would be clearly negative,” ECB researcher Lucia Quaglietti wrote in an Economic Bulletin article published Monday. “The impact could be particularly severe in the U.S.”
Source: Bloomberg Pro Terminal
Read more:
25 Canada Square, Level 33, office 50, Canary Wharf London, E14 5LQ +44 20 3608 6256
World Financial Markets - 0700 17 600 Varchev Exchange - 0700 115 44
Varchev Finance Ltd is registered in the FCA (FINANCIAL CONDUCT AUTHORITY) with a passport in the United Kingdom: FCA, United Kingdom - registration number: 494 045, which allows provision of financial services in the United Kingdom.
Varchev Finance Ltd strictly comply with the statutes of the European directive MiFID (Markets in Financial Instruments). targeting increased efficiency, transparency and uniformity of financial instruments.
Varchev Finance Ltd is authorized and regulated by the Financial Supervision Commission - Sofia, Bulgaria: License number RG-03-02-05 / 15.03.2006
The information on this site is not intended for distribution or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Disclaimer:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 63,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.