ECB’s Knot Sees Trade Curbing Inflation and Growth in Near Term

Uncertainty stemming from US trade policy is likely to curb inflation and economic growth in the near term, though its effects on prices are less clear beyond that, according to European Central Bank Governing Council member Klaas Knot.

The situation is prompting consumers to postpone spending as they’re afraid that the economy will weaken and unemployment will rise, the Dutch central-bank chief told an event in Amsterdam. The stop-start nature of the US’s trade initiatives is “unambiguously bad” for economic activity, he said.