So it begins…Anthony Albanese has called a May 3 election, setting us up for five weeks of cashed-up promises and potshots at the competition. Perhaps the prime minister’s toughest campaign task to date hasn’t been combating his fiercest rival Peter Dutton, but in assuring Australians we’ll be right following Donald Trump’s “Liberation Day”.
Close to $60 billion was wiped off the Australian stock markets in just one hour yesterday morning after Trump’s sweeping tariffs on US trade partners across the globe. Australia came out of the event OK in the end with a 10 per cent “reciprocal” tariff on all exports to the US, but Albo’s still not happy (even though the US is only about five per cent of our export market).
“For Australia these tariffs are not unexpected, but let me be clear, they are totally unwanted,” the prime minister said.
“President Trump referred to ‘reciprocal tariffs’. A reciprocal tariff would be zero, not 10 per cent. The administration’s tariffs have no basis in logic, and they go against the basis of our two nations’ partnership. This is not an act of a friend. Today’s decision will add to uncertainty in the global economy, and it will push up costs for American households. It is the American people who will pay the biggest price for these unjustified tariffs. This is why our government will not be seeking to impose reciprocal tariffs.”
Opposition leader Peter Dutton said Australia had a special relationship with the United States and “it hasn’t been treated with the respect by the administration or by the president”.
“It’s clear to me that in the language that’s come out of the administration that there is a discussion to take place and it needs to take place as a matter of urgency because, as prime minister, I want to make sure that we can help our beef producers, make sure that we can help our manufacturers, grow our industry and increase employment in this country and we can do that through a normalised relationship in a trading sense with the United States,” Mr Dutton said.
AMP economist Shane Oliver told News Corp, Australia’s real risk comes not directly from tariffs on our exports but from the threat to growth in Asia.
The good news for Aussie mortgage holders? Oliver said the tariffs could trigger more rate cuts. It’s a belief backed by the money markets which are now fully pricing in the chance of a rate cut after the Reserve Bank’s board meeting next month.
“Assuming that Australia does not retaliate and the $A does not crash then Trump’s tariffs pose more of a threat to growth than causing higher inflation here, and so add to the case for more RBA rate cuts,” Oliver told News Corp.
It’s early days in the federal election campaign but this curveball, although unsurprising from Trump, begs the question – who do you have more faith in to lead our country during this increasing period of global disruption?
If you want to hear more from Anthony Albanese and Peter Dutton, and perhaps you don’t, they’re facing off in the first major 2025 election debate on Tuesday evening.
I hope you’ve enjoyed the read.
Matt Lancashire
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