PARIS (Reuters) – The administration of the American president Donald Trump destabilizes the multilateral economic system, which weighs on the American economy and to a lesser extent on Europe, declared on Wednesday François Villeroy de Galhau, governor of the Banque de France, who was expressed before the parliamentarians of the finance committee of the National Assembly.
“Through his decisions and reversals, Trump destabilizes the multilateral system. This reversal strengthens long-term risks, whether financial order-think of cryptocurrency or non-banking-or climate intermediation,” warned the monetary policy.
The recent revision of the decrease in economic forecasts for the American federal reserve proves that instability already harms the US economy, added the manager.
“This is the manifestation of a strategy-which can be described as ‘loser-percent’-of the Trump administration: it seems to represent the world economy as a zero-sum game where the gains of some necessarily result from the losses of others,” summed François Villeroy de Galhau.
The impact of an increase in American customs duties in Europe would also be negative, although “limited”.
While the cost in Europe would be lower, an increase in American customs duties in the second quarter would have a “limited” impact on European inflation and could reduce economic production of the euro zone by 0.3% in full year, recalled the governor of the Banque de France.
At the end of March, Christine Lagarde, president of the European Central Bank, had formulated similar forecasts.
(Report Leigh Thomas, Corentin Chappron, edited by Kate Entringer)
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