Trade war cuts US companies’ market value by $ 1.7 trillion

US, WASHINGTON (ORDO NEWS) — The US trade war with China has reduced the market value of US companies by $ 1.7 trillion, writes the South China Morning Post , citing a report by the Federal Reserve Bank of New York.

Higher fees can slow investment growth by US companies by almost 2 percentage points.

The increase in duties has already reduced the growth of US investment by 0.3 percentage points by the end of 2019, and it is expected to decrease by another 1.6 percentage points this year, the authors of the report, led by economist Mary Amity, said.

American firms incurred almost all of the costs associated with raising US import duties. Firms that export to China have also become less profitable due to Chinese retaliatory duties.

The study found that ads related to the trade war were related to a drop in stock prices by 8.9%. Companies in the Chinese market suffer the most from the trade dispute, as the slowdown in the Chinese economy has reduced the return on investment made there by US companies.

Although Washington and Beijing signed the first-phase trade agreement on January 15, US $ hundreds of billions of duties are still in effect.

Meanwhile, the coronavirus pandemic exacerbated tensions between the two largest economies in the world. U.S. President Donald Trump said last week that he began to treat the trade deal with China in a completely different way after the global outbreak of COVID-19.

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