What’s happened to my mortgage and my beef? Your tariff questions answered

There could be several rate cuts as Donald Trump’s escalating trade war continues but Australians will feel some pain elsewhere with beef when they dine out. See our video.

As many as four interest rate cuts could be the fine silver lining in Donald Trump’s escalating trade war but Australia remains at risk of slower than expected economic growth, experts say.

Economists and peak bodies say the direct impact of Mr Trump’s new 10 per cent tariff on Australian goods will be minimal, but the domestic economy could slow down because of the global impact.

What are the tariffs?

A tariff is a tax on a product imported from another country.

The US has imposed a 10 per cent tariff on Australian products.

There are some exemptions such as copper, pharmaceuticals, semiconductors and lumber articles, bullion and energy and other certain minerals not available in the US.

Donald Trump singled out Australian beef in his tariff announcement.

What will be the impact on interest rates?

AMP chief economist Shane Oliver said large tariffs imposed by America on some of its biggest trading partners could mean cheaper goods coming to Australia, bringing down inflation.

“I was already expecting two rate cuts, it now adds to the case for that but we might even have more,” he said.

Mr Oliver said he was expecting a rate cut in May and August but the tariffs make the case for one in between and one at the year’s end.

We may get access to cheaper goods from other countries that would have sent it to the US, we might get cheaper Chinese cars for example,“ he said.

“That would mean lower inflation here.”

What will be the impact on the economy?

Economist Saul Eslake warned that a global recession was not off the cards.

Independent economist Saul Eslake did not go as far as predicting four rate cuts and warned that a global recession was not off the cards.

“The indirect impact via China, Japan, Korea and others is that they will send less to the US and they will buy less from us,” he said.

“(Trump’s policies) are going to precipitate a recession not just in the US because of the uncertainty it is creating.”

Hours after Trump’s announcement, early on Thursday morning, the Australian share market had already turned red.

What do farmers say?

National Farmers Federation president David Jochinke described the tariffs as a step backwards.

Farmers, who are among the most impacted export industries, said they were disappointed by the US decision.

National Farmers Federation President David Jochinke said the US decision was “a disappointing step backwards for our nation’s and for the global economy”.

“Australian producers are resilient in the face of challenges. Being among the least subsidised farmers in the world has seen the sector become highly efficient and productive.”

‘While Australian meat exports will shortly be subjected to a 10 per cent tariff, there is no ban on Australian red meat and our trade with the US will continue.’

The Red Meat Advisory Council (RMAC) said it was disappointed in the United States’ decision to impose tariffs on Australian red meat exports.

“While Australian meat exports will shortly be subjected to a 10 per cent tariff, there is no ban on Australian red meat and our trade with the US will continue,” chair John McKillop said

What about critical minerals?

Prime Minister Anthony Albanese said Australia was in a strong position to negotiate because of our critical minerals industry.

RZ Resources founder Dave Fraser operates a mine in Western NSW and all their minerals are exempt from tariffs.

“The exemption of a large number of these resources from the tariff announcement sends a really clear message that Australia and the US have a strong trading future.”

Originally published as What’s happened to my mortgage and my beef? Your tariff questions answered