The fragmentation of trade will reduce global growth and increase inflation, says Schnabel of the ECB

Global inflation can increase in the event of fragmentation of the trade caused by a commercial war and a growth will probably be influenced, said Isabel Schnabel, a member of the European Central Bank, in a presentation of Wednesday.

A serious disorder in global trade could increase inflation in various percentage points in the early years, while a “slight dissociation” would have an impact of 1%, which could take years to dissipate, said Schnabel in its slides.

“The fragmentation of trade is structurally harmful to economic growth and inflation,” he said.

Source: Terra

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