Traders Slash RBA Easing Bets as US-China De-Escalate on Tariffs

Traders are winding back bets on aggressive monetary easing by Australia in a cascading effect from the US and China agreeing to temporarily lower tariffs on each other’s products.

Money market pricing now implies the Reserve Bank will only cut interest rates three times this year, including one next Tuesday. Just four weeks ago, when US President Donald Trump’s massive tariffs on China threatened to send the world economy into a tailspin, markets were anticipating at least five RBA cuts with a decent chance of a sixth.