Money

Investor sentiment downturn pressures Australian sharemarket drop

Australian shares likely to drop as US inflation rises, Trump plans tariff escalation, mining stocks may offer some support.

Published

6 months ago

March 31, 2025

Ahron Young

Australian shares likely to drop as US inflation rises, Trump plans tariff escalation, mining stocks may offer some support.

In Short

Investor sentiment linked to US consumer inflation is set to negatively impact the Australian sharemarket, with an expected 1.1% decline before Donald Trump’s upcoming tariff escalation.

While major tech stocks suffered losses in the US, some positive movement in mining stocks may occur due to rising commodity prices.

Investor sentiment linked to the US consumer is impacting shares as the Australian sharemarket is expected to drop on Monday before Donald Trump’s Liberation Day, which will escalate the tariff war.

S&P/ASX 200 futures indicate a 1.1 per cent decline at the open after US markets fell on Friday due to a higher-than-expected inflation reading.

The S&P 500 dropped 2 per cent, the Dow Jones Industrial Average fell 1.7 per cent, and the Nasdaq decreased 2.7 per cent following the personal consumption expenditures index, which showed a 0.4 per cent increase in prices for February, rising to 2.8 per cent year-on-year.

This inflation figure coincided with US consumer confidence hitting a two-year low, negatively impacting market sentiment. Major technology stocks like Apple, Amazon, Google, and Microsoft faced significant losses.

Despite the expected pressure on the local market, some positive movement may occur in mining stocks, according to CommSec chief economist Ryan Felsman, as commodity prices rose on Friday. Gold futures hit record highs, while iron ore futures also increased.

New government forecasts predict modest growth in Australian resource and energy commodity export volumes over the next five years, with earnings expected to decline from $415bn in 2024 to $387bn in 2025.

Listed energy companies may face further pressure as oil prices decline amid global growth concerns. With inflation persisting in the US, Trump is preparing for tariffs starting on April 2. Lululemon shares plummeted 14 per cent recently due to economic concerns among shoppers.

The Reserve Bank’s rate-setting meeting on Tuesday is expected to keep the cash rate at 4.1 per cent following a reduction in February.

Money

Fed cuts rates, signals more potentially ahead

Fed lowers rates amid job market concerns, signalling potential further cuts in upcoming meetings

Published

1 day ago

September 18, 2025

Ahron Young

Fed lowers rates amid job market concerns, signalling potential further cuts in upcoming meetings

In Short:
– The Federal Reserve cut interest rates by a quarter-point to address job market concerns.
– Officials expect at least two additional rate cuts by year-end amid ongoing economic uncertainties.

The Federal Reserve has reduced interest rates by a quarter-point, addressing concerns about a weakening job market overshadowing inflation worries.

A majority of officials anticipate at least two additional cuts by year-end during the remaining meetings in October and December.

Fed Chair Jerome Powell noted a significant shift in the labour market, highlighting “downside risk” in his statements.

The recent rate cut, supported by 11 of 12 Fed voters, aims to recalibrate an economy facing uncertainties from policy changes and market pressures.

Policy Dynamics

The decision comes amid intense political scrutiny, with President Trump openly criticising Powell’s reluctance to lower rates.

Despite the controversy, Powell asserts that political pressures do not influence Fed operations.

The current benchmark federal-funds rate now sits between 4% and 4.25%, the lowest since 2021, providing some reprieve to consumers and small businesses. Economic forecasts indicate ongoing complexities, including inflation trends and the impact of tariffs on labour dynamics, complicating future policy decisions.

Money

Fed faces unusual dissent amid leadership uncertainty

Fed’s Powell navigates contentious meeting amid Trump-appointed dissenters as rate cut looms and succession contest heats up

Published

2 days ago

September 17, 2025

Ahron Young

Fed’s Powell navigates contentious meeting amid Trump-appointed dissenters as rate cut looms and succession contest heats up

In Short:
– This week’s Federal Reserve meeting faces unusual dissent as Chair Powell approaches his term’s end.
– Analysts predict dissent over expected rate cuts due to political pressures from Trump-appointed officials.

This week’s Federal Reserve meeting is set to be particularly unusual, with Chair Jerome Powell facing significant disagreements over future policy as he approaches the end of his term in May.Tensions began before the meeting when Fed governor Lisa Cook won a court ruling allowing her to attend, despite opposition from President Trump, who is attempting to remove her.

The situation is further complicated by the recent swearing-in of Trump adviser Stephen Miran to the Fed’s board, following a Senate confirmation.

Analysts believe Powell may encounter dissent on an expected quarter-percentage-point rate cut from both Trump-appointed officials and regional Fed presidents concerned about inflation.

Potential Dissent

Trump has urged significant rate cuts and for the board to challenge Powell’s decisions.

Some analysts predict dissenting votes from Miran and other Trump appointees in favour of larger cuts. Federal Reserve veterans express concerns that political motivations may undermine the institution’s integrity, with indications that greater dissent could become commonplace.

Money

RBA plans to ban credit card surcharges in Australia

Reserve Bank of Australia plans to ban credit card surcharges despite banks warning of potential higher fees and weaker rewards

Published

3 days ago

September 16, 2025

ticker NEWS

Reserve Bank of Australia plans to ban credit card surcharges despite banks warning of potential higher fees and weaker rewards.

In Short:
– The RBA plans to ban surcharges on debit and credit card transactions, supported by consumer group Choice.
– Major banks oppose the ban, warning it could lead to higher card fees and reduced rewards for credit card users.

The Reserve Bank of Australia (RBA) intends to implement a ban on surcharges associated with debit and credit card transactions. Consumer advocacy group Choice endorses this initiative, arguing that it is unjust for users of low-cost debit cards to incur similar fees as credit card holders.

The major banks, however, are opposing this reform. They caution that the removal of surcharges could prompt customers to abandon credit cards due to diminished rewards.

A final decision by the RBA is anticipated by December 2025.