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John Kehoe

RBA has interest rate trigger for Trump trade war

The Reserve Bank of Australia isn’t quite sure what impact America’s imminent next round of tariffs will have on inflation, but it is ready to act.

John KehoeEconomics editor
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The Reserve Bank of Australia monetary policy board stands ready to cut interest rates if Donald Trump’s trade war blows up the global economy.

But the dilemma for the RBA right now is that its scenario analyses are pointing to diverging potential economic outcomes. The overall impact on domestic inflation from Trump’s imminent next round of tariffs is highly uncertain.

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John Kehoe is economics editor at Parliament House, Canberra. He writes on economics, politics and business. John was Washington correspondent covering Donald Trump’s first election. He joined the Financial Review in 2008 from Treasury. Connect with John on Twitter. Email John at jkehoe@afr.com
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    Original URL: https://www.afr.com/policy/economy/rba-has-interest-rate-trigger-for-trump-trade-war-20250401-p5lo9c