Rate cut on horizon amid fears of more stock turmoil

Investors tormented by weeks of tariff turmoil will hope for a quiet return from Easter as mortgage holders eye a rate cut on the horizon.

Stocks in Australia and the US have clawed back ground in the past fortnight after US President Donald Trump hit pause on most elements of his trade war.

But continued uncertainty and the tariff story only half-told means it is too early to say the low in US, global and Australian shares has been passed, AMP Capital chief economist Shane Oliver says.

He pointed to "renewed fears" the White House might start to threaten the independence of the Federal Reserve.

Amid separate court actions to broaden the president's power to sack independent regulators, Mr Trump late last week said Fed chair Jerome Powell's sacking cannot "come fast enough".

"Any threat to Fed independence would further threaten faith in the US as a safe haven and lead to renewed market stress," Dr Oliver said.

"(It would lead to) even more upwards pressure on US bond yields and downwards pressure on the (US dollar) as investors would demand a higher risk premium to invest in the US.

"This in turn will increase the risk of US financial turmoil and US recession."

But for the real estate mogul trying to blow up the global trading system, markets this year could have been celebrating inflation being brought back under control with limited damage to economic growth, Dr Oliver said.

Underlying inflation figures released last week were lower than expected in Canada, the UK and New Zealand.

Eyes will be on Australia's next set of quarterly numbers on April 30 amid expectations underlying inflation has fallen back inside the Reserve Bank's target band.

The annual rate leapt out of the two-to-three-per-cent range in early 2022, triggering 12 rate rises in 13 months.

Along with AMP, NAB is tipping trimmed mean inflation has eased to 2.8 per cent.

That will help set the scene for a rate cut at the Reserve Bank's May 20 meeting.

"We think the tariff shock is ultimately disinflationary for Australia," NAB senior markets economist Taylor Nugent said.

"Unlike some central banks, we don't think the RBA is constrained by inflation and so can be proactive in responding to global headwinds."

Noting "exceptionally elevated uncertainty" globally, NAB is preparing for a double-sized cut of 50 basis points.

That would slice $204 off the monthly repayments for the average Australian mortgage ($642,000 over 30 years).

A week bookended by Easter and Anzac Day leaves little space for local economic indicators, with April business conditions the only of note.

Australian markets - up about nine per cent since the darkest day of the trade war on April 7 - were expected to claw back further ground.

The ASX200 rose 172.6 points or 2.26 per cent last week to 7819.1 while the broader All Ordinaries lifted 2.14 per cent to 8021.9.

The SPI/ASX 200 futures over Easter weekend were pointing to a 0.6 per cent rise in early trade on Tuesday.

But that may change with US markets tipped to retreat 0.8 per cent on open on Easter Monday (Tuesday AEST).

Investors will also watch for Tesla results out Wednesday Australian time ahead of Boeing (Thursday) and tech giants Alphabet and Microsoft (Friday).