Francois Villeroy de Galhau, European Central Bank (ECB) Governing Council member and Bank of France Governor, said that Donald Trump's economic program could cause inflation to rise in the United States and slow down global economic growth. He added that it remains to be seen if the reduction will be felt more in the United States, China or in Europe.
Trump has said he plans to install a blanket tariff of 10% to 20% on all imports, with additional tariffs of 60% to 100% on goods brought in from China. Trump characterized the plan as a way to extract money from rival nations. He argued that a tariff policy could find a new source of revenue for the U.S. government, which could offset losses from lowering or eliminating certain forms of income tax, while extracting money from rival governments.
However, Villeroy warned that American consumers are likely to bear the brunt of the many tariffs, as they will reduce consumer purchasing power.