Goldman Sachs: Fears of a trade war between China and the United States could lead to recession

(Reuters) – Goldman Sachs said on Sunday that fears were growing that a trade war between the US and China could lead to a recession and that the bank was no longer expecting a trade deal between the US and China. two largest economies in the world before the 2020 US presidential election.

"We are forecasting tariffs targeting the remaining $ 300 billion of US imports from China," the bank said in a note to customers.

On August 1, US President Donald Trump announced that he would impose September 1 tariff of 10% on a final batch of Chinese imports, which would prompt China to stop buying American agricultural products.

The United States also announced that China was manipulating the currency. China denies manipulating the yuan to gain competitiveness, the trade dispute including tariffs, subsidies, technology, intellectual property and cybersecurity. Goldman Sachs announced that it would reduce its growth forecast for the United States in the fourth quarter by 20 basis points, to 1.8%, a larger than expected impact of changing trade tensions.