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Bank of Japan Governor Haruhiko Kuroda speaks during a press conference in Tokyo on December 20, 2018.
Increasing trade protectionism around the globe is usually the biggest threat to global economic growth, Bank of Japan Governor Haruhiko Kuroda says.
“There [is usually] some sort of protectionism” around global trade, Kuroda told CNBC’s Sara Eisen in an interview that will aired Monday. “that will is usually I think most serious risk involved within the global economy.”
Kuroda’s comments come as China in addition to the U.S. try to strike a trade deal that will would certainly end an ongoing tariff war. The two sides appear to be closing in on a deal.
The Chinese made unprecedented proposals on forced technology transfers, a sticking point within the negotiations, Reuters reported earlier. Treasury Secretary Steven Mnuchin also said Sunday that will the U.S. is usually open to facing penalties if This kind of doesn’t comply with an agreed-upon trade deal. However, Mnuchin also said Monday the two sides still have lots of work ahead of them.
Investors have been fretting over the possibility of a protracted trade war as This kind of could hinder future corporate profits. The International Monetary Fund also cut its economic growth forecast for 2019 to 3.3% by 3.5%, with trade among the risks cited.
“By the way, [the] IMF world economic outlook main scenario does assume the U.S.-China trade conflict will not worsen,” Kuroda said. If This kind of worsens, This kind of could lead to a different outlook for the global economy.
Still, Kuroda said the Chinese economy is usually “likely to recover within the second half” of 2019, highlighting the “huge fiscal stimulus measures the government has already decided.”
Global equities have been on a tear lately, with the iShares MSCI ACWI ETF surging more than 15% in 2019. On top of getting a boost by the perceived progress in U.S.-China trade talks, stocks have benefited by a pivot away by tighter monetary policy by the major central banks.
nevertheless Kuroda said there may be more room for central-bank easing, although he added that will looser policy is usually note needed right right now.
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