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America’s escalating trade war with China presents a real ‘threat’

US President Donald Trump has announced a fresh round of tariffs targeting Chinese goods, a move that is expected to present a “threat” to the global economy.

A 10 percent tax on Chinese imports will come into force next week, and will rise to 25 percent at the end of the year.

It will impact goods worth over $200 billion and China is expected to retaliate.

Chief Economist at AMP Capital, Shane Oliver, tells John Stanley it’s “big news” and the trade tensions between the global heavyweights will have long-ranging impacts.

“Actually seeing those numbers up there, and the fact that they will be implemented next week, is a bit of a downer,” he says.

“I would much rather have seen negotiation by now by the two sides, China and the US, to resolve the issue.

“Certainly, it’s a threat to the global economy.”

Mr Oliver says he expects there will be backlash from both American consumers and companies, which he hopes will bring both companies back to the table.

“I’m pretty hopeful that either by late this year or early next year President Trump and China will have come to some sort of agreement.”

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