Both sides of Australian politics have urged an end to the escalating trade war between the US and China that sent Wall Street share markets reeling overnight as fears of a recession grows.
Treasurer Josh Frydenberg said when you have trade tensions between the world's two biggest economies, it's not just the protagonists who are affected.
"It's the by-standers as well,' Mr Frydenberg told reporters in Melbourne on Saturday.
Shadow treasurer Jim Chalmers agreed, warning "nobody wins" from the escalating trade war.
US President Donald Trump heaped an additional five per cent in tariffs on some $US550 billion of Chinese goods on Friday just hours after China unveiled tariffs on $US75 billion worth of US goods.
President Trump also demanded US companies move their operations out of China, stoking market fears that the global economy will fall into recession, and sending US stocks into a tailspin.
The Dow Jones Industrial Average fell 623 points or over two per cent, with even larger percentage falls recorded on other key US stock indices, setting up a weak start for the Australian market on Monday.
AMP Capital chief economist Shane Oliver remains of the view that President Trump will likely have to end the trade war if he wants to avoid a US recession and get re-elected next year.
"But at this stage there is still no end in sight and so share markets likely have to fall further to pressure Trump to solve the issue and de-escalate," Dr Oliver said in a note to clients.
Mr Frydenberg said Australia's national interest is very clear.
"It's in China and the US coming to the negotiating table, being able to resolve their differences and for the transparent rules based trading system to be maintained," he said.
Dr Chalmers said these issues need to be resolved so that the other countries in the region and around the world aren't unnecessarily impacted.
"Nobody wins from the sort of conflict we're seeing between the Chinese and the Americans," he told told reporters in Brisbane.
He hoped Australian Prime Minister Scott Morrison makes the most of his opportunity to work with other global leaders at the G7 meeting in France this weekend where he has been invited as a guest.
The US-China trade conflict will likely be a key issue at the meeting.
