President Trump’s trade war is weighing down expectations for economic growth, which economists expect will stall at 1.7 percent in 2020, according to an analysis by S&P Global Ratings.
The company’s economists see growth dropping to 2.3 percent this year, down from previous estimates of 2.5 percent, and say trade is a major reason that otherwise good economic news isn’t shining through.
{mosads}”Consumer spending and the U.S. labor and housing market are strong,” said Beth Ann Bovino, S&P Global’s U.S. Chief Economist.
“But the trade war, coupled with waning fiscal stimulus and slowing global growth, suggest that the domestic signs of strength may not be enough,” she added.
U.S. and Chinese officials are scheduled to meet in Washington next week in search of a solution for the trade war, which has included tariff increases on billions of dollars in goods traded between the two countries.
Trump has scheduled an increase in the tariff rate of $250 billion of Chinese imports for Oct. 15, just days after the talks.
The GOP is hoping other trade actions will help boost the economy.
Last week, Trump signed a limited trade deal with Japan, and his White House is reviewing a proposal from House Democrats for passing his signature trade achievement, the United States Mexico Canada Agreement.
But the growth predictions could spell trouble for the embattled Trump, who campaigned on wild promises of annual economic growth reaching as high as “5 or even 6 percent.”
Once in office, his White House tempered those expectations and predicted growth would reach 3 percent a year, and stay there.
Economic growth in 2018 came close, at 2.9 percent, the same level it hit in 2015 under President Obama, but has since come down.
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