For incoming European Central Bank President Christine Lagarde, the U.S.-China trade war is the biggest threat to the global economy.
Lagarde, who has run the International Monetary Fund since 2011 and was selected in July to replace Mario Draghi from Nov. 1, said the tariffs that the U.S. and China have slapped on each other’s goods are set to shave 0.8% off global economic growth in 2020.
“That’s a massive number,” Lagarde said in an interview with CNBC’s Sara Eisen. “It’s fewer jobs. It’s less business going on. It’s less investment. It’s more uncertainty. It weighs like a big, dark cloud on the global economy.”
“I think trade — threat against trade at the moment — is the biggest hurdle for the global economy, yes, indeed,” she added.
Trade negotiators from the U.S. and China are set to resume principle-level trade talks next month in Washington. The tit-for-tat tariff threats in the past year and a half have roiled financial markets and sparked concerns about a global recession.
