European Central Bank Governing Council member Villeroy: The impact of any new tariffs could be "moderate".

Francois Villeroy de Galhau, a member of the European Central Bank's Executive Board, stated that the escalating transatlantic trade tensions will not have a significant impact on inflation prospects. The French central bank governor said at the World Economic Forum in Davos on Tuesday that the tariffs implemented so far have not had a major impact on European prices, and added that the impact of any new tariffs could be "moderate." Villeroy de Galhau said, "If additional tariffs are imposed, we should evaluate all their effects. The direct inflation effect may be limited, but the euro could also appreciate, creating the opposite effect." Villeroy de Galhau's previous position was more dovish than some of his colleagues, and he reiterated on Tuesday that the European Central Bank must remain flexible in the face of increasing global uncertainty.