ECB President Christine Lagarde: I would like 'some certainty' on U.S.-China trade

Economic Resilience & Monetary Policy - European economies have shown surprising resilience in growth, inflation, and employment, exceeding initial expectations [1] - Monetary policy is considered to be in a good place, with inflation around 2% [4] - Interest rates are currently at 2%, and the central bank is prepared to respond to potential economic shocks [5] - The focus remains on medium-term inflation targets, with current readings looking positive [6] Trade & Tariffs - Europe's trade with the United States accounts for 17% of its total trade, making the US the largest partner [1][2] - Tariffs between the US and Europe have increased from 1.5% to 13%, impacting exporters, importers, and consumers [2] - The impact of tariffs is currently being absorbed roughly equally by exporters, importers, and consumers [3] - Increased trade between Europe and China has been observed, partly due to diversion of goods [18][19] Risks & Uncertainties - Uncertainty remains a key factor, requiring anticipation of political developments, geopolitical changes, and shifts in the global order [7] - Risks to economic growth are now more balanced, with some initial fears regarding tariffs and exchange rates not fully materializing [10][11] - Both upside and downside risks to inflation are being carefully monitored, with the current balance considered fairly even [12] - Trade tensions between the US and China, particularly regarding rare earth elements, have direct and indirect impacts on Europe [13][14][15] - Geopolitics is seen as a key driver of tariffs, rather than the other way around [23] US-Europe Relationship - A stable and predictable relationship between Europe and the United States is considered necessary, despite recent deterioration [24][26] - There is a hope for a settlement of the relationship based on trust, predictability, and reciprocated consideration [27]