Trump’s trade with allies, immigration could destabilize markets, global supply chains: Report

WASHINGTON, June 26 (APP):President Donald Trump’s trade battles with China and the US major allies, coupled with his hardline immigration policies, could push US towards recession and destabilize world markets, a news report said.
Trump is focusing on his hardline approach towards immigrants and trading allies to boost his base ahead of the mid-term elections that could decide which party holds the Congress. His policies are already causing ripples worldwide.
The Trump administration’s decision to impose tariff on steel and aluminum imports, that primarily come from the Europe, and his hardline policies towards China, Canada and Mexico has drawn retaliation by these countries, which have imposed tariff on US goods.
As a result of his tariffs, iconic motorcycle manufacturer Harley-Davidson said it would move some production out of the US while the Dow Jones Industrial Average tumbled over renewed fears from the president’s expected new trade restrictions on China, a report by online news portal The Politico said.
Gary Cohn, Trump’s former National Economic Council Director said that the tax reports that the Trump administration introduced last year and its deregulatory agenda were having the desired effects on the economy, but policies and trade and immigration were confusing the system.
Alongside his trade policies, President Trump is also building on his hardline immigration approach and have suggested that illegal immigrants should be sent home immediately without going through any legal process. He has also taken shots and curtailing legal migration that resonates with his base that helped him score a stunning win in
the 2016 presidential elections.
According to the The Politico report, Wall Street analysts are now ramping up their warnings of a potential recession given Trump’s aggressive trade moves. “Our calculations suggest that a major trade war would lead
to a significant reduction in growth,” the report said quoting Bank of America Merrill Lynch economist Ethan
Harris. “A decline in confidence and supply chain disruptions could amplify the trade shock, leading to an
outright recession.”
That feared impact has already started to show by recent economic data as quoted by the report. For
instance, the report said, a a survey of manufacturing purchasing managers from IHS Markit a closely tracked gauge
of the factory sector’s health dipped to a seven-month low of 54.6 last week.
“Nationwide, business and consumer confidence remain generally high for now. But business groups from the U.S. Chamber of Commerce to the Business Roundtable have warned that trade fights could derail confidence and slow the economy,” the report said.