‘Not the time for cuts’: PM defiant despite global economic shock

Donald Trump’s tariff war has dealt a brutal hit to Australian consumer confidence as Prime Minister Anthony Albanese refuses to explain how the government is lobbying to gain an exemption from the US president’s import duties.

Albanese used the global economic turmoil to spruik his policy agenda on Tuesday, insisting it was not a time to cut back despite the government being in a worse financial position than before other economic disasters such as the Global Financial Crisis.

“I’m absolutely certain that in these uncertain times, it’s not a time for cutting now, it’s not a time for the sort of retreat from policy that we’ve seen from the Coalition,” Albanese said.

Asked if Australia had made any progress with the Trump administration, which has not wound back any of its planned reciprocal tariffs in this round, Albanese said: “We’ll continue to engage constructively with the US administration.”

Opposition Leader Peter Dutton has also not detailed substantial spending cuts, focusing his criticism of Labor on the rising cost of living during its past three years in government, as Trump’s tariff war engulfs the election campaign and Australian consumers lose confidence.

Dutton told ABC Breakfast the potential for tariffs to further damage the economy meant his party winning the election was crucial. “I just don’t think Australians can afford three more years of a bad Labor government, and particularly if it’s a Labor-Greens government – that will see inflation come back into the system, which will force interest rates higher again,” he said.

The closely watched Westpac-Melbourne Institute measure of consumer sentiment fell 6 per cent in April, after hitting its highest level in three years, but for those surveyed after Trump’s announcement confidence was down by 10 per cent.

Westpac’s head of macro-forecasting, Matthew Hassan, said consumers had been stunned by Trump’s plans.
“With the situation still deteriorating, there is a clear risk of more significant sentiment declines in the months ahead,” Hassan said.

Falls in consumer confidence can flow through the economy as households cut back on their spending as a result, affecting businesses.