A large fiscal package geared toward pandemic relief will likely boost U.S. growth even further in 2021, but long-term inflationary risks are still balanced.

With a narrowly Democratic Congress, U.S. fiscal spending is likely to increase on economic relief from the pandemic, infrastructure, and healthcare, boosting the economic rebound.

The U.S. political focus has shifted to the reopening of the economy.

The $2.2 trillion stimulus is the biggest ever, but Congress will likely be forced to do even more.

A bolder fiscal response to the rapidly spreading coronavirus has become an economic and political imperative.

New U.S. tariffs on Mexico would add to the direct economic costs of the string of tariff hikes enacted during this administration.

With the U.S. and China raising tariffs on each other’s goods, we may be entering a prolonged period of trade tension.

While we believe the shutdown on its own would have only a modest impact on growth, the...

Even before President Trump’s inauguration, we at PIMCO had identified trade policy as a potential spoiler to the otherwise pro-growth nature of the president’s economic agenda. And the unfolding of this “summer of discontent” has only affirmed our view heading into 2018 that trade policy remains one of the biggest policy risks for markets and the economy this year.

Consistent with our view last month that the Trump administration’s more significant (and market-moving) trade actions had yet to come, the recent announcement of tariffs on Chinese products related to the Section 301 intellectual property investigation has roiled markets and increased uncertainty over the possibility of a trade war.

We believe the trade actions with the most significant potential economic and market impact have yet to unfold.