Trump’s China trade war is ‘the biggest risk to the global economy’

Hildebrand’s comments come as investors continue to monitor the prospect of an escalating global trade war between the U.S. and China. Trump reportedly said over the weekend that he is prepared to impose tariffs on an additional $200 billion worth of imports from China as soon as a public comment period ends Thursday.

Washington and Beijing have already applied charges to $50 billion of each other’s goods in a tit-for-tat trade dispute.

“Can I disagree?” Daniel Lacalle, chief economist at Tressis Gestion, told CNBC on Tuesday. “The biggest threat to the economy is not Jerome Powell and it is definitely not Donald Trump. The biggest threat to the economy is extremely loose monetary policies that have created these enormous bubbles.”

Lacalle argued that major central banks, including the Fed, were guilty of repeatedly misleading emerging market economies with empty promises.

In response, Hildebrand said: “No central banker has ever said policy will never change. In fact, the Fed has been extremely transparent about its tightening path. It has been very consistent.”

“We have a more challenging environment because of tightening but that is normal,” he added. “We have overarching risks around trade and you have some very exposed countries, that is really the way we should look at this.”

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