President Trump’s tariff war could cost the US economy around $31bn a month as foreign investors keep their money at home, according to new research by the University of Sussex and Brunel University of London.
Analysis of cross border investments has found geopolitical shocks, including the first US tariffs on China back in 2018, have led to falls in overseas investments in American equities in a phenomenon dubbed the “flight home”. The research warns the US is uniquely vulnerable to this fallback because its economy relies on a long-held surplus in international investments which is now in jeopardy.
The study reports that losses could amount to at least $31 billion in monthly foreign equity investment on average for the next two years if the trade war continues. This prediction is based on the impact of this year’s first raft of tariffs in April...
