JP Morgan: new duties on Chinese goods will cost Americans dearly

According to a new analysis by JP Morgan, after the introduction of new duties, Chinese goods may deprive the average American family of more than 1000 extra dollars a year.

Фото: Depositphotos

The United States is ready to introduce new duties (15% and 30%) on Chinese goods totaling 300 billion dollars in the fall. Some goods will be subject to higher duties starting from September 1, in the context of the ongoing trade war, writes Fox News. Duties on another part of the goods will increase from October. These terms and rates became a spontaneous decision by the US president after China introduced additional duties on American goods.

Analysts at JP Morgan report citing Yahoo Finance that cash damage inflicted on American families will increase from 600 dollars to more than a thousand after the first stage of the introduction of duties on Chinese goods.

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According to the analysis, duties will have a great direct impact on consumers. This means that they may have to cut back on their costs for certain goods and services.

“Unlike the agricultural sector, which receives subsidies/aid to offset the impact of China's retaliatory actions, there is no easy way for consumers to compensate,” the analysts wrote.

This effect may even cover most of the tax savings that Americans received as a result of the tax reduction law signed in 2017, which is about 1300 dollars a year.

Americans will feel even greater influence after the second stage, when duties will increase to 30%, as President Trump threatens. Analysts say it could cost families 1300 dollars a year.

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But will it come to that? According to experts, the duties are expected to be canceled before the 2020 presidential election of the year.

“We believe there is a strong possibility that they will eventually reverse their decision and be able to find common ground with Chinese negotiators,” the analysts wrote.

It can only depend on how soon China agrees to a "best deal." White House adviser Kellianne Conway said Trump “has views” of the negotiations.

“He wants a better deal,” she said. “He inherited a very unbalanced, non-reciprocal, unfair trade deficit with China.”

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