Rising US tariffs pose growth risks for Australia, RBA and AMP agree

InvestorDaily

In a speech at the Australian Financial Review Business Summit, deputy governor Andrew Hauser said Australia is unlikely to be directly affected by Donald Trump’s proposed tariffs, but the RBA will closely monitor potential global fallout from the escalating trade war. The comments came as Trump’s 25 per cent trade tariffs on Canada and Mexico took effect, alongside an additional 10 per cent tariff on China, bringing the total increase on Chinese imports to 20 per cent during his current term. “Australia’s direct exposure to US tariffs levied on our exports is limited,” Hauser said on Wednesday.

“Such an analysis might quickly turn, however, to the fact that Australia is heavily integrated into, and reliant on, the global economy more broadly – and particularly China,” he said. A key macroeconomic risk for Australia, Hauser explained, is the potential for US tariffs on third countries to spark a global trade war, disrupting trade and financial linkages. “As Australia’s long history has shown, we thrive when trade, labour and assets flow freely in the global economy, but we suffer when countries turn inwards,” the deputy governor added.

The rest of this article can be found at investordaily.com.au.