European Central Bank warns of sharp slowdown in global trade

WAM
21 Jun 2025, 15:40 GMT+10

BRUSSELS, 21st June 2025 (WAM) -- The European Central Bank (ECB) has warned of a significant slowdown in global economic outlook over the next two years, attributing it primarily to US tariffs and rising uncertainty surrounding international trade policies.

According to the ECB's June 2025 macroeconomic projections, global import growth is now expected to reach 3.1 percent in 2025, down by 0.4 percentage points from previous estimates. The outlook for 2026 is more severe, with growth forecast to drop to 1.7 percent, a sharp downward revision of 1.4 percentage points.

The ECB attributes the slowdown to the impact of recent US tariff increases on various imports and broader policy uncertainty across international trade channels.

On the other hand, the ECB noted several positive factors that could support the eurozone economy and enhance its resilience. These include increased government spending on defence and infrastructure, rising real household income, a strong labour market, and improving financing conditions.

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