The case for an interest rate cut in May is starting to fade as the panic in financial markets and a freefall in the Australian dollar that prompted calls for urgent rate relief from the Reserve Bank have returned to normal, economists say.

The central bank held the cash rate at 4.1 per cent a day before US President Donald Trump’s April 2 tariff announcements sent global markets into a tailspin. At the time, RBA governor Michele Bullock cautioned that policymakers needed time to assess how an escalation in the US trade war would reshape supply chains and affect growth.