Reserve Bank sees 'relatively small' Australian impact from US-China tariffs
The central bank warned that US tariffs pose a global risk — but even in the most extreme modelled scenarios, the impact on Australia’s GDP is expected to be modest.
The Reserve Bank remains unconvinced that US President Donald Trump’s new tariffs will significantly impact Australia’s economy.
In its latest Statement on Monetary Policy, released on Tuesday alongside its decision to cut rates to 4.1%, the central bank goes to great length to examine the effects of tariffs on the local economy. Even in the most extreme scenario — where tariffs on China are significantly increased — its modelling suggests only a limited impact on domestic growth and inflation.
The RBA also sees the effects of recent steel and aluminium tariffs as uncertain but likely small, both globally and for Australian exports of these commodities.
Economists have raised concerns about potential knock-on effects for Australia due to higher tariffs on China, given its status as the nation’s largest trading partner.
