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Candidates, especially Donald Trump, hurting the economy even before the election

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It's the election, stupid.

The sparring between Hillary Clinton and Donald Trump can only heat up, and some economists fear the election will worsen an already-high level of uncertainty that has caused damage to the economy and could ultimately rattle markets.

"I think more people are getting more worried about what the presidential election will do," said Chris Rupkey, chief financial economist at MUFG. "I don't count that out as a major risk factor. It could make Brexit look like peanuts in terms of the financial market effect."

Economists are forecasting U.S. growth of more than 2 percent in the second half, after the first half grew at a sluggish 1 percent pace.

But those forecasts could be at risk if uncertainty around the U.S. election increases. Sixty percent of the participants in the recent CNBC Fed survey said the presidential election is a negative for the economic outlook.