Commonwealth Bank Warns Trade War, Deficit Challenge Incoming Australian Government

The incoming Australian Labor government faces significant economic challenges, including managing a volatile global trade war driven by U.S. tariff policies and addressing a structural budget deficit, according to the Commonwealth Bank of Australia. While Australia is expected to withstand these pressures without large-scale fiscal stimulus, risks remain from the U.S.-China trade tensions, especially given China's role as Australia's largest trading partner. The government's strategic $1.2 billion critical minerals reserve is seen as a positive move to reduce dependence on China and strengthen negotiation positions with the U.S. In the UK, the newly revealed details of the MAGA mitigations deal between Keir Starmer and Donald Trump have left businesses uncertain, with quotas and conditions on tariff removals complicating anticipated benefits, particularly for the steel sector. Additionally, British political commentators discuss the potential limited impact of the UK-US trade deal alongside broader policy and political issues. These developments underscore complex trade dynamics and fiscal considerations across allied nations amid ongoing geopolitical and economic shifts.