Advisor Contribution

With just over a month until the US elections are held, we have been having many conversations with clients around how this may impact our economy, their portfolios and whether or not the outcome may lead us down different pathways here in Australia.

The outcome of U.S. elections can have a big impact on the Australian economy because of the strong ties between global trade, investment, and financial markets. Here are the main ways U.S. policies can influence Australia:

Trade Policies

The U.S. is a key trading partner for Australia, especially in sectors like agriculture, resources, and services. If U.S. trade policies change—such as introducing new tariffs or renegotiating trade agreements—it could affect Australia’s ability to sell goods to the U.S. or other countries.

Global Economic Stability

The U.S. is central to global economic stability. Changes in U.S. policies, like adjusting interest rates or altering fiscal strategies, can create uncertainty in global markets, which in turn can affect Australia’s economic performance.

Commodity Prices

Australia is a major exporter of commodities like iron ore, coal, and natural gas. U.S. policies that influence global economic growth—especially in China, Australia’s largest trading partner—can impact the demand for these exports. For example, if the U.S. focuses on reducing fossil fuel use, it could lower global demand for coal and gas, affecting Australian industries.

Currency Movements

The U.S. dollar’s value has a direct effect on the Australian dollar (AUD). U.S. election outcomes that lead to changes in monetary policy, like interest rate hikes, can either strengthen or weaken the U.S. dollar. This shift affects the AUD, influencing the cost of Australian exports and imports.

Investment Flows

U.S. elections can change investor confidence. If election results create uncertainty, global investors may seek safer options like U.S. Treasury bonds, which could lead to less investment in Australia. On the other hand, if the election leads to stable and pro-business policies, Australia may attract more foreign investment.

Climate and Energy Policy

Australia’s energy sector, particularly coal and gas, could be impacted by U.S. climate and energy policies. If the U.S. pushes for renewable energy, it may reduce global demand for fossil fuels, affecting Australia’s exports. However, if the U.S. continues to support traditional energy, Australia’s fossil fuel sectors could benefit.

Defence and Security

Australia’s defence strategy is closely tied to its alliance with the U.S. Changes in U.S. military policy could influence Australia’s own defence spending and regional security strategies.

In short, U.S. election outcomes can affect Australia through trade, investment, currency movements, and global economic stability. Given the strong connections between the two countries, any major policy shifts in the U.S. are likely to impact Australia’s economy, both directly and indirectly

Tony Catt

DIRECTOR - Catapult Wealth

With over two decades of experience in the finance industry, Tony has seen many changes in the markets. Tony has a background in accounting, research, stockbroking and financial planning which allows him to provide a broad range of advice to his clients on different stages of their life. Tony has significant experience in lecturing and seminars, providing help to Regional Skill Training (RST), the Australian Shareholders Association (ASA), regional TAFE and the ASX investor hours for over a decade.

After marrying into a farming family, Tony decided to provide more help to family businesses in South Australia. Succession planning, retirement planning, education of the next generation and protection of wealth are major issues that have been identified.Tony is ideally skilled to help families and as a specialist Self-Managed Super Fund adviser, Tony has the ability to transition clients into retirement with cost effective, tailored retirement solutions.

Keep it simple is our main approach and we ensure that you understand every facet of how your money is invested.

QUALIFICATIONS INCLUDE:

Bachelor of Commerce (Adelaide University)

Graduate Diploma in Applied Finance (Kaplan)

Graduate Diploma in Financial Planning (Kaplan)

Fellow of FINSIA

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P: (08) 8172 9111

F: (08) 8333 1932

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McLaren Vale

233 Main Road

McLaren Vale SA 5171