ECB Maintains Inflation Target Amid Trade Uncertainty: Impact on Growth Projections

The European Central Bank (ECB) has reaffirmed its commitment to inflation stability at a 2% medium-term target despite escalating trade policy uncertainties, impacting growth projections. GDP is projected to grow by 0.9% in 2025 and 1.1% by 2026, reflecting the challenges posed by these changing dynamics. The ECB highlights that this slowdown in economic growth stems from increased trade policy uncertainty, which directly impacts investment and exports. 2027 inflation targets are set at 2.0%, reflecting a return to past trends. The ECB’s strategy aims to mitigate potential risks to investment through stable inflation control.