Trump's tariff pause has soothed markets. Business confidence will take longer.
Trump’s 90-day tariff truce has restored some calm, but economists warn the uncertainty will still weigh heavily on business investment.
Donald Trump’s 90-day tariff pause has offered markets and corporate leaders a brief reprieve, but the uncertainty surrounding ongoing trade disruptions is expected to have a chilling effect on business investment.
That’s the overwhelming view among economists advising investors and corporate Australia. They believe the coming months are likely to see expansion and hiring plans shelved, which may in turn have a knock-on effect for broader economic growth.
Alex Joiner, chief economist at IFM Investors, the world’s fourth-largest infrastructure manager, said the three-month respite gives governments a chance to “gather their thoughts” and plan domestic stimulus and negotiations with the US.
“For the business sector, though, it is a period where there could be a lack of information and a lack of any certainty around the future. Usually, that means you hold off on whatever it is you were going to do, whether that be expansion plans, capital investment, employment,” Joiner told Capital Brief. “So this could still have that impact, particularly in the US.”
