ECB Officials Warn Against Over-Optimism on Inflation Target, Caution on Trade Risks

European Central Bank officials expressed cautious optimism regarding inflation trends within the euro zone, with recent data indicating progress toward the ECB's 2% target. ECB Vice-President Luis de Guindos stated that while inflation is declining, concerns about a potential trade war with the United States could complicate the economic outlook and dampen growth. He emphasized the importance of prudence in policy-making, acknowledging the impact of trade tensions on business confidence and investment. Meanwhile, Bundesbank President Joachim Nagel echoed similar sentiments, urging against over-optimism as the ECB navigates its final push to achieve price stability. Both officials highlighted the need to remain vigilant amidst uncertainties in the global economic landscape. The ECB remains committed to its inflation goals while recognizing the delicate balance required in its policy approach.