Europe's Central Bank Cuts Rates Amid Trade Tensions

The European Central Bank on Thursday did what President Trump is imploring America's central bank to do—cut interest rates. The ECB lowered its key rate from 2.5% to 2.25%, which the Wall Street Journal reports is its seventh cut in eight meetings. The bank cited concerns over the effects of Trump's aggressive tariffs on the European economy.

• "The major escalation in global trade tensions and the associated uncertainty will likely lower euro area growth by dampening exports," said ECB President Christine Lagarde, per the AP. "And it may drag down investment and consumption."

• Eurozone economic growth was 0.2% in the last quarter of 2024, while inflation stood at 2.2% in March, near the ECB's 2% target. Lagarde had floated the idea of a pause in rate cuts at the ECB's previous meeting, but the tariffs changed that thinking.
• On Thursday morning, Trump posted on Truth Social about the ECB's move and slammed Federal Reserve chief Jerome Powell for being too slow to resume cuts in the US. The Fed's next meeting is in May.