Horror session after the gory details
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Why did Trump’s tariff formula focus on trade deficits instead of actual tariff rates?
Tariffs calculated not based on the reciprocity of tariffs themselves, but actually based on a fairly simple equation of the balance of trade and imports. So not something that can be fixed by lowering tariffs in the other countries. So what exactly does Donald Trump want? That's the question countries are facing today as they figure out how to respond to the worse than expected tariffs announced yesterday. But meanwhile, Australia might actually come out of it relatively well. We'll talk about that today. And jobs numbers for the US today as well. We're not just going to be talking tariffs. It's Friday, it's the 4th of April, 2025. It's the morning call from Nab. Good morning. Well, equity markets have taken an absolute hammering this session.
The Nasdaq is down six percent, four point eight percent off the S P five hundred, the worst day since June twenty twenty. This is a pandemic scale event that we are witnessing. And four percent off the Dow. The Russell two thousand is down seven percent as well. But you know, that's all right. Donald Trump doesn't look at the share market anymore. Maybe he's uh got his money in Bitcoin. But there again that fell from eighty eight thousand just before his speech yesterday getting Down to 82,000 today. And the same story in Europe. The Eurostocks 50 down 3.6%. The DAX down 3%. The CATCARARAND down 3.3%. The FTSE 100 losing just 1.6% at the close there. The VIX index got over 29%. Bon yields are well down, down nine basis points for 10-year treasuries.
It did get down below 4% earlier. Down 12% in the UK, down seven in Germany. Aussie 10 years were down 16 basis points yesterday. Day to four point two six percent now on futures, a couple of basis points lower than that. And the US dollar is down one point seven percent on the DXY, down to just over a hundred and two. The Aussie is up naught point seven percent to sixty three point four US cents, the pound also up naught point seven percent, the euro is up one point six percent, the yen up two per cent, the Swiss franc up two point four percent, so the safe haven currency uh
How are Australian exporters expected to be affected by the new US tariffs?
That isn't acting like a safe haven currency this time is the US dollar, not surprisingly. And oil, big falls in oil. WTI has lost six point eight percent, Brent down six and a half percent to just over seventy a barrel. And gold is down one point three percent off ComEX, seven point six percent coming off silver. Is that enough movement for you for one day? Uh now we know, and uh we know the uh market really doesn't like what they've been hearing. Here's Nabs Ken Compton, he joins me uh from Sydney. I guess, you know, everyone will have heard now what those tariffs are and that we have to be thankful that Australia is one of the least impacted countries. That ten percent tariff uh and th that ten percent is not on top of the twenty five percent uh tariff of steel and aluminium, whereas China, their new tariffs are on top of the t tariffs they've already got.
Yeah, good morning, Phil. I think still even though we even though Australia sort of got away with, I suppose, being in that ten percent category, I think my yeah, we've been describing it as, you know, at least as worst as feared in terms of the overall numbers that were announced yesterday. Um yeah, and I think probably a particular concern for Australia is more so just how r relatively heavy hit some of our key trading partners in Asia are. So, you know, uh thirty four percent extra rise. On tariffs to China, pretty chunky increases for Japan and South Korea as well. So even though there was a few headlines yesterday about Australian beef getting singled out during the President's initial speech announcing the the tariffs, ultimately it probably seems the impact there.
Um it's actually a bit unclear actually what's going to go on in that specific case, but for Australia specifically, um everything actually looks reasonable. In fact you can actually probably put a bit of a positive spin on it in terms of um, you know, sort of trade redirection for Australia. But still the overall uh
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Chapters
6 chapters
1
Why did Trump’s tariff formula focus on trade deficits instead of actual tariff rates?
0:01–1:52
2
How are Australian exporters expected to be affected by the new US tariffs?
1:52–6:14
3
What did Ken Crompton say about Australia’s inflation outlook amid the tariff shock?
6:14–10:23
4
How might the RBA’s policy path change after today’s market moves?
10:23–15:16
5
What are the implications of OPEC’s planned oil output increase for global growth?
15:16–18:36
6
How will the upcoming US non‑farm payroll data influence market expectations?
18:36–18:42