Central Banks Signal Patience as Trade Policy Shifts Create Economic Uncertainty

RBA Governor Michele Bullock and Fed's Austan Goolsbee stress the need for data-driven decisions while navigating the unpredictable impacts of U.S. tariffs.

RBA Governor Michele Bullock emphasized it is too early to determine the future path of interest rates due to the ongoing unpredictability of U.S. trade policies.
Bullock warned of an inevitable period of economic and financial market volatility but reaffirmed Australia's financial system is well-positioned to handle external shocks.
Market expectations for significant RBA rate cuts in May have softened following President Trump's decision to pause further tariff hikes, though uncertainty remains.
Austan Goolsbee, President of the Federal Reserve Bank of Chicago, highlighted the absence of a clear playbook for responding to the economic shocks caused by U.S. tariffs.
Goolsbee projected that U.S. interest rates could decline within 12 to 18 months, contingent on inflation moderation and economic stabilization.