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Trade Disputes triggered by the Trump Administration with Many Trading Partners, Including China and Europe, raise more and more worries with the American industrialists.
The central bank (Fed) counts Wednesday, in its famous Beige Book, which draws up a report of the economy in the month of June and beginning July, these fears palpable in "all regions" of the country.
"In many regions, we observe higher prices and stockouts attributed to the new commercial policy," the institution said. [19659003] This confirms the words of Jerome Powell, the president of the Fed, who acknowledged Wednesday in front of the Congress that "concerns were rising in chorus" within the business community vis-à-vis the escalation of dr customs duties between the United States and its trading partners.
"Many companies are affected by this," Powell admitted, without wishing to comment further on the aggressive trade policy of the Trump administration, which, in order to reduce the country's trade deficit, imposed significant customs duties. additional billions of dollars in imports of steel, aluminum and Chinese goods.
China, the European Union, Canada and Mexico responded with rights over steel and typically American products like Bourbon or Harley-Davidson motorcycles for European measures.
The Beige Book , which is published two weeks before the next monetary meeting of the Fed (31 July and 1 August), also reports a continued rise in prices, although it remains "modest" and "moderate."
"Tariffs have contributed to the rise in the price of metal and wood, "says the Fed, which notes however that, for the moment, the transfer of these increases to consumers at the level of retail prices remains" light ".
Fears related to rising tariffs differ across regions. In New York (Northeast), a region that trades heavily with Canada, "uncertainty about trade policy is cited as a major concern".
In Boston, there is concern that "trade tensions are weakening international tourism."
– Challenge for the Fed –
In Cleveland, Ohio, a northern industrial city, the business community observe that consumers are accelerating some purchases, fearing future price increases related to the application of tariffs.
In the rural area of Saint-Louis (midwest), building professionals have complained about rising prices metal, while farmers have seen a drop in soybean prices, one of the US products targeted for import by Chinese tariff retaliation.
These concerns about price increases were downplayed by the White House, with spokeswoman Sarah Sanders explaining that President Trump was "focused on long-term economic principles."
The President "continues to look for ways to help protect American workers and it will continue on several fronts, in different ways, but in the short term, "she said Wednesday adding that the goal of the business strategy lasts the White House was "to open new markets."
In front of Congress, the head of the Fed, which seeks to avoid criticizing frontally the president's trade policy, said: "the administration says that she wants lower tariffs and I think that would be good for the economy. "
But Mr. Powell warned that if trade confrontation continued," the most difficult problem is that one could vo prices rise and at the same time witness a slowdown in activity, which could lead to higher inflation. " "If that happens, it would really become a challenge for the (monetary) policy of the Fed," he added.
The Fed is currently in a phase of gradually rising interest rates to prevent the inflation, but if it were to cope with a concomitant slowdown in activity, the rise in the cost of money and therefore of credits would be counterproductive for the economy.
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