Economists, fund managers cut U.S. growth forecasts due to tariffs: survey

2019-10-30 02:25

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WASHINGTON, Oct. 29 (Xinhua) -- About 60 percent of respondents, including fund managers, economists and strategists, have cut their growth forecasts for the U.S. economy this year and next due to tariffs, according to a CNBC Fed Survey released on Tuesday.

While recession is not the base case, respondents forecast U.S. economic growth at just 1.75 percent this year, down from 2.9 percent in 2018, and then rebounding to 2 percent in the next two years, the survey showed.

Respondents now see a 34-percent chance of U.S. economic recession in the next year, the highest since 2011, amid elevated concerns over protectionist trade policies and global economic weakness.

The survey also showed that 60 percent of respondents believe tariffs have played a significant role in the global economic slowdown, while 76 percent say tariffs have resulted in higher prices for consumers.

The survey suggested that Washington's tariffs against imports from other trading partners continued to take a toll on American businesses, consumers and the overall economy.

"The most critical issue facing the economy is the trade war and interest rate cuts will do little to change the course of growth as long as the threats of tariffs persist," Joel L. Naroff, president of Naroff Economic Advisors, was quoted as saying by CNBC.

A survey released Monday by the National Association for Business Economics (NABE) also showed that respondents expect slower U.S. economic growth over the next 12 months amid concerns over tariffs.

"After more than a year since the U.S. first imposed new tariffs on its trading partners, higher tariffs are disrupting business conditions, especially in the goods-producing sector," said NABE President Constance Hunter, chief economist at KPMG.

"Two-thirds of respondents from that sector indicate that tariffs have had negative impacts on business conditions at their firms," Hunter said.
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