Experts claim that the market instability caused by Trump outweighs the impact of his 10% tariff on Australia’s exports, Business

Easing trade tensions between the United States and China is positive news for Australia’s economy, which heavily relies on China, say experts. However, they caution that the unpredictability in the market, created by Donald Trump’s actions, is “worse than the 10% tariff.” Despite Wall Street’s significant rally, Australian investors were less impressed, with the benchmark S&P/ASX 200 share market index experiencing modest early gains on Tuesday. A graph showing the trade policy uncertainty index is embedded in the article for reference. Jenny Gordon, an honorary professor at the ANU and former chief economist at the Department of Foreign Affairs and Trade, warns that there is no end in sight to market uncertainty. She mentions that countries are not coming to the White House as supplicants, as evidenced by the experience of the UK and China. Gordon highlights that the US administration does not know what it wants in trade negotiations. The US has agreed to slash crippling tariffs on Chinese imports for 90 days, while China has reduced its levy on most American imports. Hayley Channer, a director at the University of Sydney’s US Studies Centre, believes that Trump is overestimating the US’s ability to unilaterally change trade relations. Channer states that companies are more scared of the uncertainty about Trump’s next actions than the 10% tariff itself. The article also mentions that the Reserve Bank of Australia is less likely to cut interest rates this year due to the easing of US-China tariffs. However, there is no resolution to the underlying grievances the US has with China, including trade deficits, forced acquisition of American companies’ technology, intellectual property theft, and abuse of developing nation status.

Source: https://www.theguardian.com/australia-news/2025/may/13/market-uncertainty-created-by-trump-worse-than-his-10-tariff-on-australian-exports-say-analysts