Sarah Hunter: Joining the dots - exploring Australia's economic links with the world economy

Speech by Ms Sarah Hunter, Assistant Governor (Economic) of the Reserve Bank of Australia, at the Economic Society of Australia (Queensland) Business Lunch, Brisbane, 3 June 2025.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Introduction

I'd like to begin by acknowledging the Traditional Owners of the land on which we meet today, the Yuggera and Turrbal people of Meanjin and pay my respects to Elders past and present.

And thank you to the Economic Society of Australia [Queensland Branch] for giving me this opportunity to talk to all of you.

I'm sure many are familiar with the Lenin quote 'There are decades where nothing happens; and there are weeks where decades happen'. It certainly feels like the last few months fit into the latter category. The broad-based nature of the proposed US tariffs, retaliation from major partners and other policy shifts all have the potential to structurally alter the world economy. As recently discussed by our Deputy Governor Andrew Hauser, what happens overseas matters for the Australian economy and is therefore a key factor in monetary policy settings.

In the recently released Statement on Monetary Policy (SMP) we outlined our thinking on how recent developments will influence the Australian economy. To help us understand the implications for Australia, we have developed a framework that captures the key transmission channels and combined this with a set of alternative scenarios that flex key assumptions and judgements. Together they underpin our thinking about how this environment will flow through the global economy and how Australia is exposed.