- Victory against inflation is in sight in Europe
- Inflation could be sustainably at 2% in early 2025
- Trump tariffs not expected to significantly alter inflation outlook in Europe
- Should continue to reduce degree of monetary policy restriction
- Pace of reduction must be determined by agile pragmatism
- We must maintain full optionality for upcoming meetings
It is interesting to see Villeroy take a bit of a different approach. His colleagues have gone out of the way to highlight risks regarding Trump tariffs but Villeroy is pretty much dismissing them, at least on the inflation front. But it is well worth considering the potential impact of those tariffs on the economic outlook at least.
