The Reserve Bank of Australia (RBA) Governor Michele Bullock said it’s too early to judge the impacts of the Trump administration's tariffs.
While the focus of her speech at the Chief Executive Women (CEW) Annual Dinner was to acknowledge the strides made in the economic industry for women, she took a brief moment to address the RBA’s stance on the tariff war.
“Inevitably, there will be a period of uncertainty and adjustment as countries respond to the ongoing tariff announcements by the United States administration,” Bullock said.
“It will take some time to see how all of this plays out, and the added unpredictability means we need to be patient as we work through how all of this could affect demand and supply globally.”
Bullock said the RBA is closely monitoring the situation and planning how to react as they prepare for the next Monetary Policy Board meeting on 19-20 May.
“We are carefully considering several factors, including the response of our trading partners, additional counter-responses from the US, the response of our exchange rate, and adjustments in other financial markets,” she said.
“A key focus for us is how all this uncertainty is affecting decisions made by households and businesses in Australia.”
While Bullock said we are in a time of economic volatility and uncertainty, she downplayed the negative impacts the tariffs could have.
“There are two points I want to make,” she said.
“First, we’re not currently seeing the same degree of impact as previous market events like in 2008, for example. And second, the Australian financial system is strong and well placed to absorb shocks from abroad.”
The speech comes after Wall Street staged a historic rally, causing U.S. President Donald Trump to temporarily lower heavy tariffs on many countries, excluding China.
Australia’s benchmark S&P/ASX 200 share market index jumped 4.5%, while European stocks soared in early trade on Thursday evening. The Australian dollar jumped nearly US2c to US61.5c.
In her speech, Bullock also focused on the strides made towards more women participating in the workforce and efforts made towards equity and representation, including the gradual closing of the gender pay gap.
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