The next time President Trump and Chinese President Xi Jinping will meet will likely be at the G-20 summit in Japan next month. The leaders of the world’s two largest economies will no doubt aim to resolve their long-simmering trade dispute that has the U.S. and China going tit-for-tat on tariffs. If they fail to reach an agreement, there’s a good chance Trump will follow through on his threat to place additional 25% tariffs on $300 billion worth of Chinese goods.

A new report by Citi estimates the impact of additional tariffs on virtually all Chinese imports would be far worse than what consumers have seen so far, because the first round of tariffs focused mainly on capital goods, not goods consumers purchase directly. (On May 10, Trump announced a hike in tariffs to 25% from 10%, on $200 billion of Chinese imports, with China hitting back shortly after.)

According to Citi, the prices of goods impacted by tariffs have stabilized over the past couple of months. But the U.S. Trade Representative office’s list of $300 billion worth of Chinese goods that will be included in the next round of tariffs will represent 67% of total imports of consumer goods from China, 66% of automotive vehicles, 19% of industrial supplies, and 38% of capital goods.

“So far, the impact from trade tensions on the U.S. economy has been small,” Citibank global economist Cesar Rojas told Yahoo Finance. “But if trade tensions escalate further into covering all imports from China, the U.S. consumer sector is going to be impacted even more than it has been so far. Mostly through higher prices on consumer goods.”

“Tariffs on the remaining imports from China would have a larger impact on U.S. consumers than previous rounds,” the report says.

Impact on GDP

If Trump imposes 25% tariffs on consumer goods from that $300 billion USTR list, Citi estimates that those tariffs would lower China’s GDP. Even if China retaliates, Chinese GDP will still be negatively impacted according to Citi.

However, if American firms manage to substitute all imports from China with imports from other countries, there will be no growth dividend for the U.S., and higher prices will hurt consumption and reduce GDP, Citi says.

Inflation

Executives of more than two dozen American companies have made it clear they will raise prices on consumer goods to protect their profit margins and stay competitive. Citi estimates that a 25% tariff would increase inflation by more than three times what the estimated effect of the current tariffs are.

Citi says higher prices on consumer goods could lead other companies to also raise prices on goods that are not facing tariffs to alleviate pressure on their margins.