Donald Trump’s tariff wars may dampen Australian | Australian Markets
Australian companies have taken an optimistic view for the following 12 months, boosted by the prospects of rate of interest cuts, however it’s too early to inform how Donald Trump’s tariff wars may dampen circumstances.
Nationwide Australia Financial institution’s December quarter business survey revealed there had been a sharp drop within the share of corporations anticipating inflation within the medium time period (three to 5 years) to hit 3.5 per cent or more.
About 30 per cent of companies surveyed now anticipate medium-term inflation to be about 2.5 per cent, within the Reserve Financial institution’s 2 per cent to three per cent goal vary. This was up from the 20 per cent recorded within the September quarter.
“This aligns with an improving 12 month outlook across other survey measures, and continued easing across cost measures,” NAB mentioned on Thursday.
“Expected business conditions in the next 12 months . . . improved, possibly boosted by the prospect of rate cuts, recovering consumer demand and easing costs growth over 2025.”
With the survey carried out between mid-November and early December, CreditorWatch Ivan Colhoun mentioned it was too quickly for it to replicate any impacts of US President Donald Trump’s latest tariff news.
Whereas Trump has agreed to carry off on imposing 25 per cent taxes on Canada and Mexico for 30 days, China hasn’t been so fortunate, with all Chinese language imports to the US now attracting a new 10 per cent tax.
“I’d expect that it is too early for this survey . . . to reflect much in the way of expectations let alone actuality from recent Trump tariff announcements,” he mentioned.
“Interestingly, while current and near-term expected conditions have been easing, firms’ expectations about the next twelve months have remained pretty solid and improved this quarter.”
NAB mentioned business circumstances held regular within the final three months of 2024 and whereas confidence made a slight restoration, it remained in damaging territory.
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