New York Fed John Williams said in a forum yesterday that the Trump’s tariff war with other countries have “relatively small effect on the economy. But they created higher uncertainty for businesses.
Williams said “at least so far the tariffs that have been put in place, by the United States and other countries, when you roll that up into a $20-trillion economy it doesn’t have a big effect overall on economic growth or inflation”. And, the “much more important and larger” effect is higher uncertainty for businesses. As companies put off investments due to the uncertainties, “that’s a negative for jobs in the short run…and a factor that slows the economy relative to what it could be.”
