Aluminium and steel tariffs, no exceptions. So far.
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How are the new US aluminium and steel tariffs expected to impact Australia’s economy?
Steel and aluminium tariffs, no exemptions, but maybe it's less of a big deal for Australia than it is in most other parts of the world, but maybe there's more to come as well. So are we seeing economies slowing down even now on the outlook of a world that's going to be split in two by US tariffs? And what does that mean for central banks? Could the economic slowdown bring down inflation, even if the tariffs themselves push prices up for a while? Is that part of So the Bank of Canada's reasoning when they cut rates. It's the thirteenth of March 2025. It's the morning call from NAB. Good morning. Well the US dollar did rise a little today, but it lost most of those gains. It's still up naught point one percent on the DXY and still down four and a half percent for the year to date.
Meanwhile, the Aussie dollar doing better than most, it's up naught point three percent to sixty three point two US cents. The pound is up naught point one percent, the euro is down a quarter percent, the Canadian dollar is up over not point four percent today, and the yen down naught point four percent. The US stock markets well They're a little happier, although they started to f lose their way a little bit towards the close, so a one point two percent lift in the Nasdaq. It was higher earlier. We've got a half percent rise in the S P, that's the same story. And the softening in the last twenty minutes or so of trade saw the Dow dipping into the Reddit's down point two percent at the close. Uh but equity's much higher in Europe.
The DAX is up one point five uh one point six percent, not point nine percent. nine percent for the Eurostocks fifty and half a percent for the FTSE one hundred. A mixed story for bonds, so ten year treasuries are up four basis points, up seven for ten years in Canada, up five uh for ten year guilt yields in the UK, uh but continental Europe yields are down, down two basis points in Germany, down three in France. Aussie ten years, up six basis points yesterday to four point four three percent. Now on futures up another seven basis points higher. On top of that, closer to four point five percent.
What is driving the recent rise in oil prices and how might it affect markets?
And oil is up a lot, two percent for Brent, around seventy one a barrel, uh up two point two percent for WTI. And it's Nab's Sally Old who joins me today. Nab's chief economist in waiting, not long now, Sally. Uh so before we talk tariffs, uh let's look at the numbers first. So US CPI, the headline rate is down from three percent It's two point eight percent, not bad in a month, the core rate from three point three percent down to three point one percent, these are the annualised rates obviously. Uh because price growth in February was quite a bit less than expected, and that seems to have surprised markets a bit.
Yeah, absolutely. So markets were were looking for a stronger number, as you said. Um and I guess, you know, to a certain extent this will calm fears that we're not looking at a repeat of the first quarter of twenty twenty four when, you know, we we did have quite elevated inflation um and and that did worry markets and it worried the Fed. Um and so it feels like we're not getting a repeat of that dynamic uh in Q one of twenty twenty five. But at the same time Um it does feel like these are inflation numbers that reflect um a world that looks a little bit different from the one that we're operating in. today. Um and so, you know, when we look at the direction of travel of people's forecast for where they think inflation is going to be by the end of the year, people are revising up um their forecast for both headline and core because of the impact of of tariffs.
And so, you know, while it's good news for markets in in the short term, um, I'm not sure that we can really extrapolate too much given some of the changes to US tariff policy that have happened in the interest
So we can't draw any conclusion as to what this means in terms of the number of cuts this year. But also, uh I mean, we might be revising inflation forecasts up, but are we also expecting that uh demand is gonna slump a little bit as well?
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Chapters
8 chapters
1
How are the new US aluminium and steel tariffs expected to impact Australia’s economy?
0:02–1:54
2
What is driving the recent rise in oil prices and how might it affect markets?
1:54–4:25
3
Is a stagflation scenario looming as tariffs push inflation higher and growth lower?
4:25–6:35
4
How are consumer and business sentiment shifts influencing domestic demand?
6:35–9:00
5
Why is Australia maintaining a low‑profile response to the US tariffs?
9:00–11:05
6
What are the implications of EU retaliation and a broader global trade war?
11:05–13:19
7
How are policy sequencing and deregulation shaping growth prospects this year?
13:19–15:26
8
What are the latest trends in global bond yields amid tariff tensions?
15:26–17:25