Bank of Spain to lower growth forecasts due to U.S. tariffs, ECB’s Escriva says

MADRID: The impact of U.S. tariffs on Spain will lead the Bank of Spain to revise down its 2025 growth forecasts, Spain’s central bank governor Jose Luis Escriva said on Wednesday.

“In the case of the Spanish economy, we will have to downgrade our growth forecasts,” Escriva, who is also and European Central Bank’s policymaker, told Spanish broadcaster TVE, adding that job creation could also be impacted.

Escriva said however any forecasts were subject to high uncertainties.

EU seeks unity in first strike back at Trump tariffs

Last month, the Bank of Spain said it expected the country’s economy to expand by a strong 2.7% this year, up from the 2.5% forecast in its previous quarterly update. Its forecast then had not measured any effect recent geopolitical tensions may have on economic activity.

A rout in global financial markets triggered by the U.S. tariffs announcement has solidified the case for another ECB rate cut next week and supports arguments for even quicker policy easing from the world’s second largest central bank, economists say.