US China Tariffs Update – September 2018
Recent tariff announcements are a modest negative for growth in US and China although Chinese policy will look to offset the impact.

Overview:
- Recent tariff announcements are a modest negative for growth in US and China although Chinese policy will look to offset the impact.
- If markets remain calm and the tariff war does not escalate further, particularly to other countries, the impact should be contained.
- US-China tariffs are a negative for the AUD but threatened future actions are largely already priced in.
- For interest rates, as we expect a modest economic impact we have not changed our forecasts – we still see the US Federal Reserve lifting their funds rate further and in time the RBA following with a higher cash rate – there are both upside and downside risks to our rates forecasts.
For further details please see the attached document: