President Donald Trump’s bellicose trade disputes are just exacerbating the macroeconomic forces that lead to a larger trade deficit, according to Beth Ann Bovino, U.S. chief economist at S&P Global Ratings Services.

With the recent tax cut and rising budget deficit, the U.S. is relying more on foreign money flows to pay our bills.

With the increased uncertainty from trade disputes, even more money will flow into the haven of U.S. assets.

With so much money pouring in from overseas, the U.S. capital account is forced into surplus. And given that the capital account and current account must balance out, the U.S. inevitably runs a trade deficit, she said in a note to clients on Friday.

Targeted tariffs might narrow a bilateral balance with China, but that won’t necessarily fix the boarder trade deficit, she said.

A surge of foreign investors could cause an inverted yield curve as low-term Treasury rates push lower at the same time the Fed is raising rates at the short end.

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Some Fed officials are worried that an inverted yield curve is a precursor of a recession. So the Fed may have to slow its rate hikes, Bovino said.

There is also the opposite risk — that the trade tensions upset U.S. relations with key partners just when the U.S. economy needs foreign capital to fund its spending spree.

If demand from abroad for U.S Treasuries weakens just as our fiscal and trade deficits widen, the U.S. could see long-term interest rates jump and a tightening of credit conditions, thus slowing down the growth rate “or worse, cutting the U.S. expansion short,” she said.