Vanilla XJO Thread, page-72

XJO is down 2% today. A tariff war could be the trigger for a correction. I think that Trump's war is more likely to escalate than be resolved quickly. But who can predict Trump? This is only the first day of trading after the tariff announcements, so it is too early to say whether this is the start of a substantial correction.

The AUD has taken a hit today as well as the XJO. If the AUD continues to weaken then the chances of an RBA interest rate cut reduce because an already-weak AUD is putting upwards pressure on inflation. Not only is it the RBA's job to combat inflation, but it is also the RBA's job to protect the AUD. Although the RBA seems to have conveniently forgotten this. To firmly counteract inflation and to support the AUD, the RBA should be increasing rates (don't worry, it won't happen).

"A drop in RBA rates would also be a boost to the bond market. (And make your next overseas holiday a little more appealing from a financial point of view.)"
Not sure why redb thinks that a drop in RBA rates would be good for Aussies travelling overseas. It won't. The AUD will fall if RBA rates fall. This is a minor point, redb's posts are among the best on HC.

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I think that I've figured out what's really going on with the tariffs. Trump wants manufacturers to move their factories to the USA. And he isn't happy with heaps of fentanyl being produced in China and other countries and then being smuggled into the USA via Mexico and Canada. He wants to force Mexico and Canada to tighten up their border controls to stop the traffic. Or maybe he wants tariffs to be paid on the fentanyl instead of it being smuggled in. Whatever, I think that the tariffs will encourage fentanyl manufacturers to move their factories to the USA. Not sure if Trump has thought it through.