The Fed cuts by 25 basis points as expected, with one more expected next month. The Fed is being cautious as the US economy lands softly. China’s EV exports to Australia surge. New Zealand is wary of how tariffs might affect beef exports.
In our bonus Deep Dive interview, ANZ Chief Economist for Southeast Asia and India Sanjay Mathur analyses how Trump’s tariffs might affect economies in Asia, outside of China.
5 things to know:
The US Federal Reserve cut its key rate by 25 basis points to a range of 4.5% to 4.75% on Friday morning Sydney/Melbourne time, as expected. US stocks rose to fresh record highs. US Treasury yields were flat.
ANZ’s Head of G3 Economics Brian Martin and Senior Economist Tom Kenny see the Fed cutting one more time this year, before a relatively slow series of three cuts next year to a trough at 3.75%.
One area that may be less affected by Trump’s tariffs is China’s EV exports to Australia, says ANZ Australia Economist Sophia Angala.
New Zealand has plenty of trade at stake with America if Donald Trump follows through on his promise to put a 10% tariff on all imports, says ANZ New Zealand Chief Economist Sharon Zollner.
But Sharon says there has been some good news on trade deals for New Zealand recently.
Cheers
Bernard
PS: Catch you tomorrow with a look-ahead to Australian wages and labour force figures later in the week.
