RALEIGH – North Carolina consumers and businesses can expect to feel very quickly the impact of a growing trade war between China and the U.S. with a new round of tariffs on Chinese products likely to drive up prices, says N.C. State economist Dr. Mike Walden.

Walden doesn’t see the trade stand-off triggering a recession, but he does expect damage.

“Like the national economy, if the tariffs stick – and especially if China retaliates – economic growth will slow,” Walden tells WRAL TechWire.

“I don’t mean slow enough to cause a recession – recessions mean negative growth- but I mean growth slowing to between 2 percent and 2.3 percent rather than 2.5 percent to 2.7 percent without the tariffs.”

President Trump ordered a new round of tariffs to take effect on a host of Chinese goods – including iPhones and technology products – on Friday. The news sent Wall Street into a tizzy with shares dropping 300 points on the Dow.

Walden says the economy at the retail level will be affected in short order.

So why did latest round of trade war break out? Here’s what NCSU economist thinks

Trade war tariffs could drive up costs for iPhones, consumer electronics

“The new US tariffs on China will take two to three weeks to be seen,” he says. ‘But economic markets are very forward looking, so if it appears there is no immediate resolution coming out of the current trade talks in Washington, then we could see higher consumer prices on imported Chinese goods within a week.”

Citing North Carolina’s reliance on exports and the growing high-tech sector, Walden says the state “economy will continue to expand, but certain sectors will be more impacted if China responds with more tariffs on our exports.  Agriculture and technology would be most impacted.”

And he warns consumers buying products locally will be pinched.

US-China trade war: How we got here and why it matters

“Yes, these tariffs will hit more consumer products than did the previous tariffs levied on China,” he explains. “So consumers will see more of the direct effects, which would likely create  more political pressure for a resolution.”

Inflation also will be a factor, Walden warns. “If consumer prices rise as a result of the tariffs – even if the rise is one-time, measured inflation would be higher for the year – likely closer to 2.5 percent than the current 2 percent.”