Trade
Goldman Says Trump’s New China Tariff Plan Would Slow US Growth
- Extra import charge would also lift US inflation, Goldman says
- Even with revenue boost, impact on GDP “modestly negative”
Trump imposed tariffs of up to 25% on more than $300 billion of Chinese imports while he was in the White House.
Photographer: Michael Nagle/BloombergThis article is for subscribers only.
A steep increase in US tariffs on Chinese imports — which presidential candidate Donald Trump has vowed to impose if he’s elected — would hobble the domestic economy and push inflation up, according to Goldman Sachs Group Inc.
Every percentage point increase in the effective tariff rate would reduce US growth by as much as 0.15% if China retaliates, Goldman analysts said in a note on Saturday. Even if Trump used the resulting revenue to finance tax cuts that would spur spending and investment, the hit to gross domestic product would still be a minimum 0.05%.