US, China trade measures could impact global economy
If tariffs increase to erode trade relations, global economy would be negatively affected, Moody's says
The trade measures that the U.S. and China have taken against each other could have a negative impact on the global economy, Moody's said on Friday.
The U.S. President Donald Trump said he will impose tariffs of $60 billion on Chinese imports on Thursday. In return, Beijing later announced retaliatory tariffs of $3 billion on its American imports.
Moody's said the direct impact of these trade measures on the American and Chinese economies will be limited; but warned that if they escalate, the global economy would be threatened.
"If they mark the start of an unraveling of the current rules-based architecture, the U.S. and global economy will be significantly negatively affected," the rating agency said in a statement.
The rating agency added other major economies around the world could take similar actions in their trade policies, which could further weaken the global trade relations.
"Under such a scenario ... a slowdown in trade, higher prices and weakening of business and consumer confidence would take a toll on economic growth globally," Moody's said.
