Australians feel the impact of Donald Trump’s | Australian Markets

Millions of Australians’ superannuation balances fell at the finish of February as US President Donald Trump introduced his trade tariffs.

Chant West stats show the median growth fund, which is 61 to 80 per cent invested in growth belongings like shares, was down 0.9 per cent in February.

This comes off the back of a sturdy begin to the 12 months when the median growth fund jumped 2.2 per cent in January.

US President Donald Trump signed an govt order to start dismantling the Department of Education on Thursday, March 20. “Closing the Department of Education would provide children and their families the opportunity to escape a system that is failing them,” the govt order learn. In footage revealed by Margo Martin, particular assistant to the president and communications adviser, Trump could be seen signing the order whereas surrounded by youngsters, who additionally seem like signing paperwork. Credit: Margo Martin through Storyful

Chant West senior investment analysis supervisor Mano Mohankumar mentioned volatility crept back into sharemarkets on the back of weaker US financial knowledge and considerations about the potential impact of Trump’s tariff bulletins.

“In February, both Australian and international shares were down, with Australian shares falling 3.8 per cent,” he mentioned.

Despite the sharemarket wobbles persevering with in March, Mr Mohankumar cautioned superannuation members from switching funds.

“With sharemarket volatility continuing into March, and an uncertain economic and geopolitical backdrop, it’s an important time to remind members that superannuation is a long-term investment and that throughout their superannuation journey, there will be periods of choppiness,” he mentioned.

“More often than not, it (switching) results in poorer long-term outcomes than if they ride out the ups and downs. And we know that over the long term, there are far more ups.”

Mr Mohankumar mentioned superannuation funds had time and time again weathered troublesome durations in the market.

“Most Australians have their super invested in well diversified portfolios with their exposure spread across a wide range of growth-orientated and defensive asset classes,” Mr Mohankumar mentioned.

“That diversification helps limit the damage during periods of sharemarket weakness as we saw in February and March to date.”

Mr Trump’s 25 per cent tariffs on metal and aluminium imports got here into impact on March 12, with no exemptions and a risk of doubling levies on metal and aluminium from Canada ought to the nation retaliate with a surcharge on electrical energy exports.

On March 4, the US President raised the tariff on all Chinese items going into America by 20 per cent. He additionally carried out a 25 per cent tariff on items imported from each Canada and Mexico.

NED-9175-Australia’s GDP

Mr Trump mentioned further sectoral tariffs, in addition to a international reciprocal tariff coverage for nations implementing tariffs on the US, will begin from April 2, 2025.

Mr Mohankumar mentioned superannuation over the long time period nonetheless carried out above expectations.

“Since the introduction of compulsory super in July 1992, the median growth fund has returned 8 per cent a year – well above the typical 3.5 per cent target,” he mentioned.

“Even looking at the past 20 years, which includes three major sharemarket downturns – the GFC in 2007-2009, Covid-19 in 2020, and the high inflation and rising interest rates in 2022 – super funds have returned 7.1 per cent a year, which is still comfortably ahead of the typical objective.”