While it's often challenging to see the clear impact of an economic policy in the data, this is not the case with US President Donald Trump's trade war. Virtually every analysis of the slowdown in global growth and the heightened probability of recession cite the negative impact of the tariffs the Trump administration has levied on trading partners, mostly China, and their retaliatory tariffs on the United States.
US manufacturing has been contracting most of this year, meaning that that sector is already in recession. A recent analysis by Federal Reserve economists estimates that the impact of the trade war could reduce US real GDP growth by 1 per cent by early next year.
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