The Federal Reserve has again pointed out the damage that a trade war between the US and key partners could cause to the economy.
Through last Thursday’s publication on the minutes of the June meeting, the central bankers indicated: “uncertainty and risks associated with trade policy had intensified, adding they “were concerned that such uncertainty and risks eventually could have negative effects on business sentiment and investment spending.”
Their comments were published on the eve of President Donald Trump’s tariffs on Chinese goods taking effect. As from midnight on Friday, the first wave of US tariffs will apply to 818 Chinese goods ranging from boat motors to LEDs and radio equipment.
Several contacts in the Fed’s districts also sounded the alarm on tariffs. People in the steel and aluminium industries said they expected prices to increase.
Contacts in the agricultural sector reported some improvement in business conditions, but were worried that tariffs would make their exports less attractive to foreign buyers.
July, 09 2018
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