Lagarde: U.S.-China trade war could be risk for world economic outlook

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The trade war between the United States and China could be a risk to the world economic outlook if it is not resolved, said International Monetary Fund (IMF) Managing Director Christine Lagarde on Friday during a visit to Uzbekistan.

"Obviously, the downside risk that we have is continued trade tensions between the United States and China," Lagarde said, referring to the IMF's world economic outlook.

"And if these tensions are not resolved, that clearly is a risk going forward."

China decided to impose tariffs of 25 percent, 20 percent and 10 percent on certain U.S. products starting June 1 after the U.S. hiked tariffs on 200-billion-U.S.-dollars' worth of Chinese goods from 10 percent to 25 percent.

Adjustment of economic outlook

The IMF last month cut its growth forecast for 2019 to 3.3 percent, down from the 3.5 percent it had previously predicted.

It warned at the time that growth could slow further due to trade tensions and a potentially disorderly British exit from the European Union.

"But we expect that at the end of 2019 and in 2020 it will bounce back," Lagarde said of the world economic outlook on Friday.

Source(s): Reuters