“These cuts really do have an instant impact,” David explained. “Following the September cut, major US, European, British, and Australian stock indexes all hit record highs. But the real story is what comes next — the Fed winding down its quantitative tightening campaign.”
That move — essentially the opposite of quantitative easing — could have a faster and more serious effect than the rate cuts themselves, as the Fed steps back from removing money from the economy.
However, the global picture is far from simple. As David noted, tariffs and trade tensions are creating competing forces that muddy the waters for imports and exports.
“It’s difficult to cut through the noise and separate the impact of rate cuts from the impact of tariffs,” he said. “Across Europe, New Zealand, and Australia we’re seeing more patriotic calls to buy local — and that could prove more influential than monetary policy alone.”
Despite declining business confidence in the US, the outlook elsewhere is brighter. European and Australian markets have shown strong inflows and growing confidence — particularly as Australia’s role in supplying rare earth minerals positions it as a key ally in the global supply chain reshuffle.
“Hopefully, there’s a windfall for Australia at the end of all of this,” David added.
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