April 6, 2018 / 8:49 PM / a year ago

Trade war could be extremely disruptive: Fed's Williams

FILE PHOTO: President and Chief Executive Officer of the U.S. Federal Reserve Bank of San Francisco, John Williams, addresses a news conference in Zurich, Switzerland, September 22, 2017. REUTERS/Arnd Wiegmann/File Photo

SANTA ROSA, Calif. (Reuters) - San Francisco Federal Reserve President John Williams, who will take the reins of the New York Fed in June, said that while trade actions taken so far have not impacted his assessment of economic growth, the prospect of a trade war does keep him up at night.

“So far (the tit-for-tat on tariffs with China) doesn’t change my view of the economy,” Williams said in answer to a question after a speech in Santa Rosa, California. But a trade war could not only hurt economic growth but could also lead to an undesirable rise in inflation, he added. “The global economy is built on trading with each other, and if we were to try to unwind all of that it would be extremely disruptive and very costly, both for the U.S. and the world,” he said.

Reporting by Ann Saphir; Editing by Leslie Adler

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