De Guindos warns of volatile EU financial markets risk amid trade turmoil

European Central Bank (ECB) Vice President Luis de Guindos stressed the importance of closely monitoring unstable financial markets, particularly amid the risk of an uncontrollable decline. Despite the stability of the banking system, De Guindos emphasized the need to remain cautious.

According to him, trade conflicts can pose challenges for both households and corporations. This could lead to an increase in credit risk for banks and non-bank financial institutions. At the same time, de Guindos noted that banks in the eurozone currently have strong fundamentals. They are well positioned to handle potential shocks thanks to sufficient capital and liquidity reserves.

In his speech in Brussels, de Guindos also expressed concern about the increase in US Treasury bond yields and its potential consequences.

The official confirmed that the ECB will base its next monetary decisions on relevant data at each meeting, rather than committing to a specific strategy.