Rate cuts still on the way after US-China tariff pause

The trade truce between the US and China has given markets a much-needed boost, with stocks climbing and the US dollar surging. But with tariff uncertainty still hanging over the economy, bond investors say rate cuts will still be needed to dodge a recession.

While news that US and Chinese officials has agreed to slash tariffs by more than 100 per cent for 90 days prompted investors to scale back their rate cut expectations, the bond market is still pricing in three reductions in Australia before Christmas.

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