New Delhi, July 11 -- The recent surge in the trade wars impacting global economy is due to the trade imbalances between the countries, according to a report by SBI Funds Management.

The report noted that tensions between the United States and China are because of deeper rooted problems of global economic imbalances. China invests much more than it consumes, while the US consumes far more than it invests, leading to a sharp imbalance in global trade flows.

It stated "The tariff issue highlights the deeper economic imbalance between the U.S. and China".

As per the data quoted in the report, China's investment stands at 42 per cent of its GDP, while household consumption is only 40 per cent.

In contrast, the US invests only 22 per cent ...