The Bank of Spain will assessment the expansion forecast of Spain for the tariff warfare | Economy | EUROtoday

The governor of the Bank of Spain, José Luis Escrivá, introduced Wednesday that the establishment will assessment its financial forecasts for the tariff coverage of the president of the United States, Donald Trump. “We will have to review the growth forecasts. We, in the case of the Spanish economy, our last forecast was 2.7%, which is a high growth for the Spanish economy. The logical thing is that we review it down and what I cannot say at this time, because we still do not have it and because it is not easy to do, it is how much,” mentioned Escrivá.

The governor, in statements to TVE, has confused, nevertheless, that any assessment of the forecasts “will be subject to very large elements of uncertainty”, as a result of “there are elements on which there are really not sufficiently powerful analytical instruments to be able to afford them.”

Escrivá has assured that the establishment is “monitoring in a very close and direct way” the state of affairs, which has outlined as “an extraordinary complexity from the economic and geopolitical point of view.”

“We know that what is happening has the potential to generate very negative effects on economic activity in the world in a very asymmetric way, but it is also true that we still do not have precise elements of how it will materialize and to what extent and with what temporary sequence,” he mentioned.

The governor has affirmed that this “offer disturbance” that Trump has generated together with his insurance policies is “very hard” and has “the potential to generate strong falls of economic activity or deceleration in those economies”, such because the Spanish, which is rising at “relatively high” ranges.

“I would not talk about recession in any case, but that this will have any impact on economic activity,” mentioned Escrivá, who has additionally indicated that the counterweight measures which can be being exercised to counteract Trump “have the effect of raising prices.”

“These are the most obvious elements, but there are more difficult elements to capture that they can do the most complex situation. On the one hand, not only a tariff rise is produced, but what may be in question is the operation of value chains and supplies chains with which world production has been internationalized and this can generate segmentations in trade and disruptions,” he mentioned.

This further adverse impact on world financial exercise would are available a second second and is tough to worth, based on Escrivá, which has added that past the direct results generated by this example, there’s additionally a confidence impact.

“When the markets and the feeling of consumers and investors are affected by such disruptive situations, there is the potential that spending decisions are retracted. And this can also happen with some delay. All this makes it very difficult for us to put numbers to what is the impact that this situation is having or will have both economic activity and on inflation,” he mentioned.