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Companies await China retaliation; weaker growth expected

Written by The Associated Press | May 13, 2019 5:23 AM
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An investor reacts near boards displaying stock market prices in Beijing, China. (AP Photo/Ng Han Guan)

(Beijing) -- Companies are waiting to see how China will retaliate for President Donald Trump's latest tariff hikes on Chinese imports while economists warned the escalating dispute could slow growth.

Chinese officials gave no indication Monday what steps they might take after threatening "necessary countermeasures" for Trump's penalties on $200 billion of Chinese goods, imposed Friday.

Trade talks wrapped up later Friday in Washington without an agreement.

Jake Parker, the vice president of the U.S.-China Business Council, an industry group, said officials appeared to be studying the potential impact on China's economy before deciding how to respond.

Morgan Stanley economists said the tariff hike could trim China's annual economic growth by 0.5 percentage points.

They said that impact could grow if uncertainty prompts companies to cut jobs or postpone investment.

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