A Monash expert is available to discuss how the ASX took a $156b hit in early trade as Trump’s tariffs shake the market, and how it compares to other major shocks, and what could be expected.
Available to comment:
Dr Isaac Gross, Lecturer Department of Economics, Monash Business School
Contact: +61 490 819 643 or isaac.gross@monash.edu
Read more of Dr Gross’ commentary here: Monash Lens
The following can be attributed to Dr Gross:
“The Australian stock market has fallen over 9 per cent in the past month in response to Trump’s tariffs. While the global 10 per cent tariff has now been implemented, the more aggressive round of so-called "reciprocal" tariffs targeting countries with trade deficits will hit on Thursday — meaning things could get worse.
“The direct impact on Australia is limited, as the US is only our 4th major trading partner. The real risk lies in China. If steep tariffs — over 50 per cent in some cases — crash Chinese exports to the US, they could push China toward recession. That would hammer demand for the iron ore and coal we export to fuel their economy, especially if the tit-for-tat escalation continues.
“The flow-on effects: rising unemployment and falling prices as cheap goods from tariff-hit economies seek new markets, including Australia's. With that backdrop, the RBA is almost certain to cut rates at its next meeting in May, and further cuts later in the year look increasingly likely.
“The impacts on the superannuation sector should be fairly limited. Young people who are the most exposed should have plenty of time to make up the losses, while older investors should have mostly shifted away from volatile stocks into safer assets.”
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