Trade tensions with China need to linger for an extended period to cause real damage to the United States economy, St. Louis Fed President James Bullard said in remarks published on Monday.
Engaged in a lengthy trade standoff, the United States and China have raised tariffs on a range of goods, raising fears that their conflict would develop into a trade war, damaging the global economy and worsening its recent growth wobble.
"I think the U.S. is such a big and diversified economy that the impact compared to the size of the entire economy would be relatively small," Bullard, a voting member of the Federal Open Market Committee, was quoted as saying in the online edition of Handelsblatt.
"In order to do real damage to the U.S. it would have to go on for some time."
Bullard added that this trade conflict appears to get more attention outside the United States because the conflict may disturb trade patterns and slow investment outside the U.S., particularly in the case of small, open and trade-reliant economies.
"For them it can be very damaging, if the trade network is upset or even threatening to be upset. Smaller countries are caught in the crossfire," Bullard added.
© 2023 Thomson/Reuters. All rights reserved.