A 25% tariff on all Chinese imports to U.S. would cut U.S. GDP by 0.3%–0.6% and global growth by 0.1%–0.2%
WASHINGTON—Progress in trade talks between the U.S. and China has sidelined the Trump administration’s threat to raise tariffs on Chinese goods to 25%—and that’s a good thing for the U.S. and the world, a new study concludes.
Tariffs of 25% on the roughly $540 billion in Chinese goods imported annually to the U.S. and retaliatory tariffs on the $120 billion of U.S. exports to China would dent U.S. gross domestic product by 0.3% to 0.6%, according to a study published Wednesday by the International Monetary Fund.
Such damage would come as trade declines or shifts to other countries, and as U.S. businesses and consumers have to shoulder higher costs for imported goods.
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