Finance
Trade fragmentation to curb global growth, raise inflation, ECB's Schnabel says
Published by Global Banking & Finance Review®
Posted on April 2, 2025
1 min readLast updated: January 24, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on April 2, 2025
1 min readLast updated: January 24, 2026
Trade fragmentation could raise global inflation and hinder growth, warns ECB's Schnabel. Severe disruptions may increase inflation by several points.
FRANKFURT (Reuters) - Global inflation could surge in case of trade fragmentation caused by a trade war and growth is likely to take a hit, European Central Bank Isabel Schnabel said in a presentation on Wednesday.
A severe disruption in global trade could push up inflation by several percentage points in the initial years while 'mild decoupling' would have an impact below 1%, which could take years to dissipate, Schnabel said in her slides.
"Trade fragmentation is structurally harmful for economic growth and inflation," she said.
(Reporting by Balazs Koranyi; Editing by Andrew Heavens)
The main topic is the impact of trade fragmentation on global growth and inflation, as discussed by ECB's Isabel Schnabel.
Trade fragmentation can increase global inflation by several percentage points in severe cases, while mild decoupling has a smaller impact.
Trade fragmentation is structurally harmful to economic growth, potentially causing long-term negative effects.
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