Global growth could pay the cost if the U.S. along with China keep fighting over trade, warned Paul Gruenwald, chief economist at S&P Global Ratings.
“The trade by itself doesn’t actually move the needle in terms of the macro. yet what we’re worried about is usually the trade spat drags on … consumers stop spending so much, firms stop investing, confidence goes down, along with we go to a less not bad growth path,” he said.
along with if the earth’s two biggest economies enter a full-fledged trade war, which could cause a “significant reduction” in growth — although a global recession is usually unlikely, he told CNBC’s Oriel Morrison at the Asian Development Bank’s annual meeting in Manila.
Trade talks are ongoing in Beijing between the two countries, which have announced plans to levy tariffs against each additional.
China has canceled several shipments of U.S. soybeans inside the past month.