Australians vote in national election with their sights on Trump, living costs

(Reuters) - Voting began on Saturday in Australia's national election that polls show will likely favour Labor Prime Minister Anthony Albanese over conservative challenger Peter Dutton, with voter appetite for change dampened by worries over Donald Trump's volatile diplomacy.

Polling booths in Australia - among the few democracies with mandatory voting - opened at 8 a.m. local time, although a record 8 million out of 18 million eligible voters had already cast ballots before Saturday.

Overseas, tens of thousands of Australians were expected to cast ballots at booths set up in 83 countries, Australia's foreign affairs department said.

Albanese said his centre-left government had "built really strong foundations during this term" and needed a second term to follow through on key policies such improving housing affordability and strengthening Medicare, the country's universal healthcare system.

"We want to be able to continue to kick goals for Australia," he said in Victoria state capital Melbourne, according to a transcript.

Dutton, also starting his day in Melbourne where several seats could go either way, urged voters to choose the Liberal-National coalition "to get our country back on track".

"Under Labor Australians have faced the largest fall in living standards on record," he said on social media platform X.

Both major parties have focused on cost-of-living pressures but opinion polls show that global uncertainty driven by Trump's stop-start tariffs rapidly became a top issue for voters during the campaign.

Australia is a close U.S. security ally and generally runs a trade deficit with the United States. Even so, it was not spared Trump's tariffs with a 10% duty imposed on Australian exports.

Labor has tried to cast Dutton as a Trump-lite conservative, hoping some of Australians' overwhelmingly negative sentiment towards the U.S. president will rub off on the opposition leader.

A former policeman, Dutton has forged a reputation as tough on borders over two decades in parliament and pledged to cut thousands of public service jobs.

He sought to distance himself from comparisons with Trump adviser Elon Musk's agency-cutting fervor but fell behind after the U.S. president placed tariffs on Australia. Dutton had led in opinion polls as recently as February.

A Newspoll published on Friday in The Australian newspaper showed Labor leading 52.5%-47.5% against the Liberal-National coalition, under Australia's two-party preferential voting system.

Political strategists said Trump was not likely to be the decisive factor in the election - Albanese has run a strong campaign and Dutton made mistakes, including a short-lived proposal to ban public servants working from home. But the Trump effect, they said, has added to reservations for voters who became risk-averse.

Several polls suggest Labor may be forced into a minority government. Preferences among supporters of the minor parties and independents could be crucial under Australia's ranked-choice voting system.

Pollster Roy Morgan noted that the vote for independents and minor parties had doubled since 2007 and was increasing at every election.

In the 2022 election, the primary vote split nearly equally among Labor, at 32.6%, the Liberal-Nationals, at 35.7%, and "others" at 31.7%. Roy Morgan Chief Executive Michele Levine said a third of voters opting for independents and minor parties was likely again in this year's vote.

(Reporting by Kirsty Needham and Sam McKeith in Sydney; Editing by Edmund Klamann and Stephen Coates)