ROME (Reuters) - The economic policies of U.S. President Donald Trump could hurt global trade and could speed up an increase in U.S. interest rates, European Central Bank policy maker Ignazio Visco said on Monday.
“Given the current situation of the U.S. economy, which is close to full employment, strong fiscal expansion risks having a pro-cyclical impact,” Visco said in a speech at the Italian foreign ministry.
“In such a case, the process of normalizing monetary conditions undertaken by the Federal Reserve could be less gradual,” said Visco, who sits on the ECB Governing Council and is the governor of the Bank of Italy.
“The consequent appreciation of the dollar and increase in medium-to-long-term interest rates, which up until now have been contained, could accentuate and reverberate their impact on international markets,” he said, adding that this could hurt emerging markets.
Reporting by Giuseppe Fonte, writing by Crispian Balmer