HSBC warns global growth is slowing, US-China trade war weighing on sentiment
- Trade war, Brexit leading to increased uncertainty, risk
- Slowing has yet to translate into higher credit losses at the bank
HSBC’s top leaders warned on Friday that global growth is slowing and continuing trade tensions, including a trade war between the US and China, are weighing on economic sentiment.
Chief executive John Flint said that “increased uncertainty and risk” in the global economy are related to rising protectionism, questions about the United Kingdom’s exit from the European Union – known as Brexit – and the future direction of interest rates.
“This is yet to translate into higher credit losses, but that could change if the global economy deteriorates,” Flint said at the bank’s annual meeting in Birmingham, UK.
“We will be proactive in managing costs and investment to meet any risks to revenue growth, but we will not take short-term decisions that harm the long-term interests of the business. We also have a business that is diversified, resilient and well-placed to navigate the risks inherent in today's world.”
US President Donald Trump has placed tariffs on about half of all goods imported from China as tensions have risen in the past year between the world’s two largest economies.
China and the US are continuing to discuss a trade agreement and moved a step closer earlier this week by agreeing to set up enforcement offices to monitor implementation of any trade pact – a key point for US negotiators.