Trade War Poses Significant Risks to US Economy

In a recent report, Scope, a Germany-based credit rating agency, highlighted the potential negative impacts of the ongoing trade war on the United States. According to Alvise Lennkh-Yunus, the head of Scope, the US could face credit negativity if the trade war undermines trust in the dollar.

Three Scenarios Outlined

Lennkh-Yunus presented three possible outcomes of the trade war. The first scenario involves light tariff implementation, which could lead to investment uncertainty, credit risk, and a technical recession in the US. The most severe scenario, featuring permanent duties, could result in a "multi-year recession" for Americans and jeopardize global financial stability.

Conclusion: The report underscores the US's vulnerability to the trade war's adverse effects, positioning it as the epicenter of potential policy shifts with far-reaching consequences.