This is how Trump’s tariff tantrum could affect the US and Chinese economeis
Deutsche Bank describes Donald Trump’s latest threat as a ‘significant escalation’ and says it could mean a hit to China’s real economy of 0.3% of GDP
Some of Wall Street’s biggest banks have run the numbers on how US President Donald Trump’s latest trade salvo will hit economic growth in the US and China. Here is a summary of their takes: If Donald Trump goes ahead with tariffs on $250bn worth of imported Chinese goods, the hit to US growth would be about 0.3-0.4 of a percentage point and for China it could mean a drag of 0.3 of a percentage point, according to Morgan Stanley. There’s also the risk of an indirect hit to China arising from supply chain complexities, which could subtract another 0.3 of a percentage point from growth. "The potential imposition of further tariffs on imports from China reaffirms our view that trade tensions will likely linger for longer," Morgan Stanley economists led by Chetan Ahya wrote in a note. "While we still see negotiations as the endgame, getting there will take longer, leading to increased risks to business confidence and capex." Deutsche Bank described Trump’s latest threat as a "significan...
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