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Tariff disruption is an opportunity for Australia, says economist
Patrick Commins
As the world braces for more weeks of watching and waiting to see what Trump will do with tariffs, the good news is that “Australia’s in probably the best position to handle” the fallout from the US president’s assault on global trade.
That’s the view of Warwick McKibbin, an ANU economics professor and a recognised world leader on modelling the potential impact from America’s new era of trade protectionism.
As news emerged that the US administration had flagged countries had another three weeks after the 9 July deadline to do a deal and avoid higher “reciprocal” import taxes, McKibbin told the Australian Conference of Economists on Monday that we should be looking at these disruptions as an “opportunity” to expand trade with our partners.
“We should be doing trade negotiations. We should be lowering barriers which make trade harder.”
In April, US president Donald Trump revealed a slew of reciprocal tariffs on nations including Australia. Photograph: Carlos Barría/Reuters
McKibbin’s conclusion that Australia would be left relatively unscathed by US-led trade disruptions was backed up by separate Productivity Commission analysis which showed our economy could even receive a small boost from America’s higher trade barriers, and concluded that retaliating with our own tariffs would be counterproductive – a bipartisan position in Canberra.
This “small, positive effect” comes about as goods previously sold to the US are diverted to us at a cheaper rate and as we also scoop up some of the investment that flows out of America and heavily tariffed countries, the PC said.
But Alex Robson, the PC’s deputy chair, warned the 0.4% modelled lift in GDP did not account for other, harder to model knock-on effects.
“The proposed tariffs are likely to have a relatively small direct effect on us, but the global uncertainty they’ve brought about could affect living standards in Australia and around the world,” Robson said.
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Tom McIlroy
Labor – and everyone else in Canberra – is waiting on the outcome of Donald Trump’s snap review of the Aukus nuclear submarine agreement.
In early June, the US department of defense announced a 30-day review of the Australia-US-UK technology sharing deal, with the aim of ensuring the deal signed by the Biden administration “is aligned with the president’s ‘America first’ agenda”. It will also determine if the US defence industrial base is meeting the country’s needs.
Overseen by Elbridge Colby, the Pentagon’s under secretary of defense for policy, a known Aukus sceptic, the review could become a critical factor in Trump’s relationship with the Albanese government and significant in the ongoing US-Australia alliance.
The start date of the review is unclear, but this Friday will be 30 days since it was publicly announced.
A Pentagon spokesman told Guardian Australia overnight there is no news on the timeline just yet.
Albanese is expected to have his first face-to-face talks with Trump later this year, possibly in September after the United Nations general assembly or at the Quad summit in India.
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Indigenous business must be ‘backed’ to Close the Gap
A landmark report from Supply Nation found Indigenous businesses create $42.6 bn of social value each year and allow First Nations people more freedom to live on their own terms.
Successful businesses lead to better mental health outcomes, more pride among communities and a better connection to culture and Country, the report found.
Supply Nation, which provides Australia’s biggest database of Indigenous businesses, said “social value” included things such as agency over life, expanded aspirations, financial security and physical and mental health.
Approximately $16.2bn of the social value created was experienced by Indigenous employees, the report said. Supply Nation’s chief executive, Kate Russell, launched the Sleeping Giant Rises report at a Business Sydney event on Monday coinciding with Naidoc Week. She told AAP:
By lifting up our Indigenous communities … that is saving government money in terms of welfare payments … but it’s also lifting a sense of pride, aspiration, happiness and wellbeing in those communities.
Governments must consider giving Indigenous entrepreneurs or indigenous businesses a seat at the table when they’re making broader policies like Closing the Gap. They deserve to be backed.
Nearly 66,000 First Nations people are employed by Indigenous businesses, and 84% of owners said those employees were better able to support families and feel positive about life.
– Australian Associated Press
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Updated at 18.20 EDT
Bright spots in agriculture amid market volatility
With droughts on one side of the country, floods on the other, and political volatility overseas, Australia’s agriculture industry has been right in the thick of it.
But there is reason for “cautious optimism” in the $90.7bn sector as uncertain conditions create both threats and opportunities for the nation’s producers, according to Bendigo Bank’s mid-year agriculture outlook.
Cropping, horticulture and cattle were forecast to be on the up in the second half of 2025, while prices for sheep and wool would remain stable, today’s report claims.
Aussie beef will continue to be on the menu in the US, where herd numbers are in decline due to drought and increased costs of agricultural inputs
Weather conditions have both helped and hindered production, as rainfall in NSW and Queensland improved soil moisture, boosted summer crop yields and gave winter sowing a strong start.
However, heavy rainfall and flooding in both states has damaged farm infrastructure and reduced livestock numbers in some regions. At the same time, severe drought in parts of South Australia, Western Australia and Victoria has stifled production, upped the cost of feed and created a poor cropping outlook.
With varying long-term rainfall forecasts across the nation, weather will be key to performance in the final half of the year, the report said.
The season so far underscores the growing unpredictability of Australia’s agricultural climate, demanding resilience and adaptability across the sector from producers and the broader supply chain.
– Australian Associated Press
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Updated at 18.00 EDT
Andrew Messenger
Queensland zoo to reopen two days after woman loses arm to lioness
A woman has lost her arm after being attacked on Sunday at a Queensland zoo by a lioness, which the zoo insists “was not hungry” or maltreated.
Queensland’s health minister, Tim Nicholls, confirmed that the woman, who is in her 50s, had “lost her arm” in the attack, which took place at about 8.32am on Sunday at the Darling Downs zoo, south of Toowoomba.
In a Facebook post on Monday afternoon, Darling Downs zoo said the victim was “not an employee, a keeper or a zoo visitor”, but “a much-loved member of the zoo owners’ family”. In a post on Sunday, they said the woman had been “watching keepers working in the carnivore precinct”, something they said she had “done many, many times over the past 20 years”.
“It has still not been possible to interview her to establish what led to this tragic incident,” the zoo wrote in the Monday post, adding that there was no plan for the animal to be put down.
We can confirm that she was attacked by a lioness. She was not in its enclosure.
The zoo emphasised in the post that the animal “was not hungry, skinny, taunted or tortured”.
“A full investigation has been carried out by Workplace Health and Safety Queensland,” they went on.
As a result the Darling Downs zoo will reopen at 9am tomorrow [Tuesday] morning.
Read the full story:
ShareNino Bucci
One report, 33 recommendations, but Kumanjayi Walker inquest findings draw on two centuries of pain
The conclusions of coroner Elisabeth Armitage on how similar deaths could be prevented reflect the impact of colonial massacres and domestic abuse.
Armitage sets forth a course over 683 pages, with 33 recommendations, to stop more deaths like Walker’s. He was shot three times by Zachary Rolfe, then a police constable, at house 511 in Yuendumu, a town 300km north-west of Alice Springs, during a bungled arrest in November 2019. The house is barely 400 metres from where Armitage handed down her findings on Monday.
The murder charge that Rolfe faced and was found not guilty of more than four years ago centred on 3.1 seconds between when he shot Walker the first time, and when he shot him twice more.
But Armitage was working in centuries, tracing back the impacts of colonisation on the Warlpiri, expanding on the link between the horrors they had faced from police and governments for generations.
Read the full story here:
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Queensland nurses to escalate industrial action
Queensland’s nurses will today escalate industrial action, continuing a battle with the state government over wages and conditions.
Sarah Beaman, the secretary of the Queensland nurses and midwives’ union, said the decision was a “historic step in our push for a deal that recruits, respects and retains this state’s frontline nursing and midwifery workforce”.
“Nurses and midwives are holding our health system together through sheer heart, skill and determination,” she said.
We’re at breaking point – and we’re done being disrespected. We are over the state government’s stalling tactics.
Nurses and midwives are today escalating action to keep Queenslanders safe.
The action is set to begin from 7am at all state government facilities.
There are about 55,000 nurses and midwives employed by Queensland health.
All union members working for the state government can choose to undertake a range of industrial actions, including taking their full break, not emptying bins or undertaking other office tasks, not taking overtime unless with a minimum notice period, not attending some meetings and not entering details meaning the department does not get some Medicare rebates.
We have not taken this decision lightly, but the government has left us no choice.
This protected industrial action is about making sure there are enough nurses and midwives to care for Queenslanders – now and into the future.
Fair pay. Safe conditions. Respect. That’s all we’re asking.
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Aldi trials delivery service for Canberra customers
Jonathan Barrett
Aldi Australia is teaming up with delivery service DoorDash to trial grocery deliveries as the discount chain grapples with a consumer shift towards online shopping.
The service will open to Canberra residents this week ahead of a potential expansion across the country, the German supermarket chain said in a statement.
Aldi has long resisted offering delivery services given it would increase operational costs. This would either make the business less profitable for its German owners, or require Aldi to increase grocery prices, undercutting its advantage over its more expensive rivals Coles and Woolworths.
An Aldi executive told a government inquiry last year that “if you have employees picking the groceries instead of customers doing their own shopping, obviously that is a cost that is incurred”.
The discount grocer previously ran a short-lived Australian trial in which shoppers could purchase some of its “special buys” online. In the UK, Aldi offered deliveries through a tie-up with Deliveroo early in the pandemic but the partnership has since ended.
Australia’s dominant supermarkets Coles and Woolworths have heavily invested in their online services to tap into the customer trend towards deliveries, pressuring Aldi to respond.
ShareRafqa Touma
Thank you Martin Farrer for kicking off the live blog this morning. I’ll be keeping you updated with the day’s news from here – let’s go.
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Jewish group calls for national anti-hate unit
Australia’s Jewish community is pushing the federal government to set up a national task force to curb antisemitism, the Australian Associated Press reports.
A Victorian taskforce will examine police powers after a spate of alleged antisemitic incidents in Melbourne in recent days, including an alleged arson on the East Melbourne synagogue that forced 20 worshippers inside to flee.
The Executive Council of Australian Jewry, an umbrella group for the nation’s Jews, feared further alleged antisemitic attacks and said more than state-based action was needed. It urged the federal government to adopt a 15-point action plan, including the establishment of a national taskforce to clamp down on antisemitism.
“I don’t know where the next attack will be or when or how, all I can say is that it is statistically likely that it will occur,” the council’s president, Daniel Aghion, said. “So far, we have been lucky in that no one has died.”
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Tariff disruption is an opportunity for Australia, says economist
Patrick Commins
As the world braces for more weeks of watching and waiting to see what Trump will do with tariffs, the good news is that “Australia’s in probably the best position to handle” the fallout from the US president’s assault on global trade.
That’s the view of Warwick McKibbin, an ANU economics professor and a recognised world leader on modelling the potential impact from America’s new era of trade protectionism.
As news emerged that the US administration had flagged countries had another three weeks after the 9 July deadline to do a deal and avoid higher “reciprocal” import taxes, McKibbin told the Australian Conference of Economists on Monday that we should be looking at these disruptions as an “opportunity” to expand trade with our partners.
“We should be doing trade negotiations. We should be lowering barriers which make trade harder.”
In April, US president Donald Trump revealed a slew of reciprocal tariffs on nations including Australia. Photograph: Carlos Barría/Reuters
McKibbin’s conclusion that Australia would be left relatively unscathed by US-led trade disruptions was backed up by separate Productivity Commission analysis which showed our economy could even receive a small boost from America’s higher trade barriers, and concluded that retaliating with our own tariffs would be counterproductive – a bipartisan position in Canberra.
This “small, positive effect” comes about as goods previously sold to the US are diverted to us at a cheaper rate and as we also scoop up some of the investment that flows out of America and heavily tariffed countries, the PC said.
But Alex Robson, the PC’s deputy chair, warned the 0.4% modelled lift in GDP did not account for other, harder to model knock-on effects.
“The proposed tariffs are likely to have a relatively small direct effect on us, but the global uncertainty they’ve brought about could affect living standards in Australia and around the world,” Robson said.
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Bondi Junction stabbing copyright case ends
The copyright case brought by the fiance of Bondi Junction stabbing victim Dawn Singleton has ended with a judgment in favour of defendants, Nine, on the eve of the trial.
Nine had been accused by Singleton’s partner, Ashley Wildey, of breaching copyright by republishing the young woman’s social media photos in the wake of her murder by Joel Cauchi before he was shot dead by police last in April 2024.
The copyright case was set down for two days in the supreme court of New South Wales before both sides agreed to a judgment in favour of the defendants on Monday. No order was made as to costs. Nine’s statement reads:
“Nine welcomes the NSW supreme court judgment in favour of Nine confirming that the photos, which were widely published by multiple media outlets throughout Australia and overseas after being placed on social media, were appropriately used by Nine.”
Here’s how we reported the case:
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Reserve Bank widely tipped to cut rates today
Patrick Commins
Borrowers should be in for some welcome good news today, with the Reserve Bank board widely expected to deliver an interest rate cut at 2:30pm, Sydney time.
Financial markets and economists agree that a second straight cut is essentially a done deal – though there’s always a chance that the central bank will surprise us all and hold.
If they do follow up with a 0.25 percentage-point move lower to 3.6%, it will be the third cut in the RBA’s cash rate target after moves in February and May.
Weak household spending and a bigger-than-expected drop in inflation in May both supported the case for lower rates, economists say, not to mention the looming threat of Donald Trump’s trade war.
A rate cut today would trim $76 from the monthly interest bill on a $500,000 mortgage, bringing the total benefit of this year’s cuts to nearly $230 once lenders pass them on to their customers. Of course, what’s good news for existing homeowners is more problematic for would-be homeowners, who are seeing property prices accelerating again as borrowing costs fall.
The RBA’s governor, Michele Bullock, will hold a press conference at 3:30pm where she will no doubt be asked whether we can expect further rate cuts this year.
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Updated at 16.54 EDT
Welcome
Good morning and welcome to our live news blog. I’m Martin Farrer with the best overnight stories before Rafqa Touma picks up the news baton.
The Reserve Bank’s monetary policy committee meets in Sydney today and it is widely expected by economists and analysts to conclude with a decision to cut interest rates by 0.25%. We have more coming up, plus the news when it happens at 2.30pm.
Australia’s leading Jewish group has stepped up its calls for a stronger government response to the alleged arson attack on a synagogue in Melbourne by calling for a national unit to combat hate crimes. More coming up.
The copyright case brought against Nine by the fiance of Bondi Junction stabbing victim Dawn Singleton over its use of a photograph in an edition of 60 Minutes ended last night with a judgment in favour of defendants on the eve of the trial. More coming up.
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Updated at 16.49 EDT
