Photo taken on April 19, 2022 shows the IMF Headquarters in Washington, D.C., the United States. (Photo by Ting Shen/Xinhua)

The International Monetary Fund (IMF) released a report on July 22 local time, warning that the Trump administration's move to impose import tariffs on nearly all of its trading partners "would have significant macroeconomic effects". 

The report noted that the tariffs are likely to reduce global demand in the short term, leading to "a negative supply shock (especially for the imposing countries), and add to inflationary pressures through rising import prices." Moreover, the uncertainty surrounding the tariffs could undermine consumer and business confidence and increase volatility in financial markets.

The report noted that the US tariff hikes could prompt other countries to respond by raising their own trade barriers to address widening imbalances, further deepening geoeconomic fragmentation. Such a trend would inflict lasting damage on the global economy.

Global Times