The ongoing trade war between the United States and China could impact the global macro outlook and send the world economy into a recession within nine months, said Morgan Stanley's chief economist Chetan Ahya.
"Investors are generally of the view that the trade dispute could drag on for longer, but they appear to be overlooking its potential impact on the global macro outlook," Ahya wrote in a research note.
While the outcome of the trade war is "highly uncertain," if Washington continues with its tariffs on Chinese imports "we could end up in a recession in three quarters," he warned. "Is such a prognosis alarmist? We think otherwise," Ahya concluded.
