The U.S. tariffs on Chinese products are impacting an unintended aim as the trade war roars, an IMF (International Monetary Fund) study reported. The study was released in recent time and said that tariff revenue fetched from levies on Chinese products “has been borne entirely” by the U.S. importers. The U.S. and China have been involved in a trade dispute for over a year. In that time, they have aimed billions of dollars valued goods having high import tariffs. Nevertheless, “there were almost no alterations in the ex-tariff border costs of imports from China and a pointed jump in the post-tariff import costs matching the scale of the tariff,” the study stated.
The U.S. President Donald Trump alleged that the higher tariffs on Chinese products are “filling the U.S. coffers” to the amount of $100 Billion every year. But the IMF stated the two-sided trade deficit amid China and the U.S. stays “widely unchanged” even with the levies. Trump has also elevated the possibility of increasing tariffs on an extra $300 Billion in Chinese products. According to the IMF, this can impact the consumers as firms are likely to pass on the supplementary cost.
On a similar note, lately, economists stated that the risk of ingrained US trade dispute with China is increasing. Several stock market strategists and economists are starting to bet that trade spats are not “easy to conquer,” as Trump famously announced in a tweet over a year ago. As April and May passed on, most of the economists and other trade and investment expertise were positive in a trade deal that can be attained between the U.S. and China. As of June approaches, many now state their main working foundation is that the two biggest economies globally are instead directing down to a path to a financial cold war that can last for years.
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