Christine Lagarde stated that the high U.S. tariffs on European products will not hinder the Eurozone economy, which is nearing recovery. She added in an interview with Fox Business that companies will adapt once the situation becomes clear and stable without repeated disputes or renegotiations. Bloomberg reported Lagarde saying the impact of the tariffs on the Eurozone’s GDP, which includes 20 EU countries, will be limited. Speaking at the Jackson Hole central banking conference in Wyoming, she noted that while the economy is not booming, it is increasingly reaching its potential with modest but resilient growth supported by good consumption and investment. Lagarde’s comments suggest that the recent EU-U.S. trade agreement does not cause major concern for ECB policymakers.

The ECB kept interest rates unchanged in July, and the likelihood of maintaining them next month is growing, with German central bank chief Joachim Nagel stating there is a “major hurdle” to further action after eight rate cuts so far.