Meeting of 16-17 April 2025 Account of the monetary policy meeting of the Governing Council of the European Central Bank

May 22, 2025--Held in Frankfurt am Main
1. Review of financial, economic and monetary developments and policy options Financial market developments
Ms Schnabel recalled that President Trump's announcement on 2 April 2025 of unexpectedly high tariffs had sparked a sharp sell-off in global equity markets and in US bond markets, leading to a surge in financial market volatility.

The severity of the tariffs and the manner in which they had been introduced had led to a breakdown of standard cross-market correlations, with a sell-off of US equities occurring at the same time as a sell-off of Treasuries in the context of a marked depreciation of the US dollar against major currencies.

Movements in euro area risk-free rates reflected the opposing impacts of the historic German fiscal package and the global trade conflict.