National Australia Bank chief executive Andrew Irvine has warned that global economic uncertainty sparked by the Trump administration’s policies is likely to continue for some time, amid signs trade tensions are affecting the confidence of its business customers.
NAB, the country’s biggest business lender, highlighted the uncertain situation caused by escalating global trade tensions as it reported $3.6 billion in half-year profits on Wednesday.
National Australia Bank chief executive Andrew Irvine.Credit: Dominic Lorrimer
Irvine said Australia’s economy was probably through the worst of a weak patch, but the sense of uncertainty would continue for some time, and businesses appeared cautious about committing to taking on new debt in the current economic environment.
“The first few months of this year have witnessed pretty dramatic shifts in global economic policy. I expect unpredictability and volatility will persist for a while yet,” Irvine said.
“This uncertainty may be uncomfortable for businesses and for households, but overall, Australia enters this period in good shape.”
‘The first few months of this year have witnessed pretty dramatic shifts in global economic policy. I expect unpredictability and volatility will persist for a while yet.’
NAB chief executive Andrew Irvine
Irvine said the slowdown in inflation would open the door to interest rate cuts from the RBA, which would help to boost the confidence of both households and business customers.
NAB economists are forecasting a super-sized 0.5 percentage point cut from the Reserve Bank later this month, followed by 0.25 percentage point cuts in July, August, November and next February.
Irvine said that Australia’s direct trade with the United States was low, but indicated be believed macroeconomic conditions and trade tensions were affecting business confidence, and business owners were being “thoughtful and careful” about committing to extra borrowing.
