#USChinaTensions The tensions between the United States and China have been rising, affecting trade, investment, and global economic growth. The tensions have led to a reduction in U.S. corporate investment, especially for companies exposed to China, and to the reconfiguration of supply chains for U.S. companies away from China. The U.S.-China Tension Index, constructed by tracking newspaper articles, shows a close alignment with the views expressed by decision-makers in business and policy. Key areas of tension include¹ ²:

- *Trade disputes*: Tariffs imposed by both countries have reduced trade and increased prices for consumers

- *Technological innovation*: Competition and security concerns, particularly regarding Huawei and 5G technology

- *Information security*: Issues related to data protection, cybersecurity, and intellectual property

- *Military escalation*: Increased military presence and activities in the Asia-Pacific region

- *Economic impact*: Elevated tensions have adverse effects on aggregate economic outcomes and at the company level, including reduced investment, R&D, and hiring