The head of the International Monetary Fund reiterated her call for the U.S. and China to de-escalate their trade war, which she warned is the biggest risk to global economic growth.
The global economy remains “precarious” despite projections for continued growth and early signs of stabilization since the slowdown, IMF Managing Director Christine Lagarde said in a statement at the end of two days of talks between finance ministers of the Group of 20 countries.
U.S. President Donald Trump is rattling financial markets. He hiked tariffs on Chinese products after talks with Beijing broke down, and the IMF says those and retaliatory duties from China could reduce global gross domestic product by $455 billion.
Trump reversed his threat to slap tariffs on Mexican goods after the two sides reached a deal on efforts to curb migration.
“The first priority should be to resolve the current trade tensions — including eliminating existing tariffs and avoiding new ones — while we need to continue to work toward the modernization of the international trade system,” Lagarde said, according to the statement. “This would be the best way for policy makers to give more certainty and confidence to their economies and to help, not hinder, global growth.”