President Trump's latest round of tariffs on Chinese goods and decision to brand China a currency manipulator, followed by China's scrapping new purchases of U.S. agricultural goods, will hurt the economies in both countries, economists warn. A Reuters survey of economists conducted Aug. 6-8 and released Friday found that about 70 percent said the latest salvos in the escalating trade war have brought the next U.S. recession closer, 45 percent of economists surveyed said the U.S. economy will slip into recession within the next two years, and a majority predicted that the Federal Reserve will cut rates again in September and then at least once more this year.
Trump frequently complains that the Fed's rate increases have been hurting the economy and stifling growth, but a New York Times analysis Friday shows that the Fed "has kept interest rates lower than under any other president since Jimmy Carter, when adjusted for the economy's output and inflation," and "Congress has provided an unusual level of fiscal support." Those combined stimulus measures have buffered the economy against damage from Trump's tariffs and China's retaliatory measures, "but as the dispute escalates, that insulation may not be enough," the Times says. Economists warn "that the Fed, in particular, has only so much help to give."
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
-
Parker Palm Springs review: decadence in the California desertThe Week Recommends This over-the-top hotel is a mid-century modern gem
-
The real story behind the Stanford Prison ExperimentThe Explainer 'Everything you think you know is wrong' about Philip Zimbardo's infamous prison simulation
-
Is it safe for refugees to return to Syria?Talking Point European countries rapidly froze asylum claims after Assad's fall but Syrian refugees may have reason not to rush home
-
Judges block $25B Kroger-Albertsons mergerSpeed Read The proposed merger between the supermarket giants was stalled when judges overseeing two separate cases blocked the deal
-
Rupert Murdoch loses 'Succession' court battleSpeed Read Murdoch wanted to give full control of his empire to son Lachlan, ensuring Fox News' right-wing editorial slant
-
Bitcoin surges above $100k in post-election rallySpeed Read Investors are betting that the incoming Trump administration will embrace crypto
-
Enron mystery: 'sick joke' or serious revival?Speed Read 23 years after its bankruptcy filing, the Texas energy firm has announced its resurrection
-
US charges Indian tycoon with bribery, fraudSpeed Read Indian billionaire Gautam Adani has been indicted by US prosecutors for his role in a $265 million scheme to secure solar energy deals
-
Boeing machinists approve contract, end strikeSpeed Read The company's largest union approved the new contract offer, ending a seven-week strike
-
US economy still strong in final preelection reportSpeed Read It grew at a solid 2.8% annual rate from July through September
-
Boeing machinists reject deal, continue strikeSpeed Read The rejection came the same day Boeing reported a $6.2 billion quarterly loss
