SYDNEY (Reuters) – Australia will be able to manage the direct impact of Donald Trump’s tariffs but economic growth will take a hit as the U.S. and Chinese economies slow, Treasurer Jim Chalmers said on Monday.
“We expect more manageable impacts on the Australian economy, but we still do expect Australian GDP to take a hit and we expect there to be an impact on prices here as well,” he said in a press conference, after releasing economic modelling that predicted a 0.1% fall in gross domestic product in 2025.
The modelling also forecast a 0.2% increase in inflation, which currently sits at 2.4%.
Chalmers said the government expected U.S. and Chinese growth to take “big hits” as a result of a global trade war triggered by Trump’s tariff regime.
Concerns about the Chinese economy had already sent the Australian dollar below 60 cents for the first time since the pandemic, he added.
“The damage being done by the tariffs decision is now very clear for all to see,” he said.
(Reporting by Christine Chen in Sydney; Editing by Alasdair Pal)
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