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Key Points: Australian home prices are likely to fall by 10% to 15% into 2024 primarily as a result of poor affordability and rising interest rates. The negative wealth effect from falling home prices should help limit how much the RBA raises rates. A change...
Key Points: Successful investing can be very difficult in times like the present with immense uncertainty around inflation, interest rates, war in Ukraine & continuing covid waves. This makes it all the more important to stay focused on the basic principles of successful investing. These...
Key Points: A budget windfall has allowed both more spending and lower budget deficits, with the 2022-23 budget deficit expected to be $80bn (down from $99bn in December). Key measures include “cost of living” payments, a temporary cut to fuel excise, more spending on infrastructure...
Key Points: The Fed has finally joined other central banks in raising interest rates, taking the Fed Funds rate from a range of 0-0.25% to 0.25-0.5%. This was well flagged and reflects the tight US labour market and high inflation. The Fed flagged another six...
Key Points: Oil prices have spiked on the anticipation and now reality of restrictions on Russian oil supply from the war in Ukraine. This is driving a sharp rise in petrol prices which will hit household spending power. Fortunately, there is an offset in Australia...
Key Points: The situation regarding Ukraine is at high risk of getting worse before it gets better for investment markets. The key is how much Russian energy exports are disrupted & whether NATO forces avoid the conflict. Five big picture implications are likely to be:...
Edwin Starr’s classic 1969 anti-war song, War, asks: “War: What is it good for?” and responds emphatically “absolutely nothing.” It’s hard to argue with the sentiment. But it turns out Starr was not completely correct. You see, despite the terrifying carnage and destruction, war can often...
Key Points: The RBA will end quantitative easing this month. While it now sees unemployment falling below 4% and higher inflation it is prepared to be “patient” for now. We expect rate hikes to commence in August. Ultimately, we see the cash rate rising to...
Key Points: Share markets have fallen in recent weeks on the back of worries about inflation, monetary tightening, the Omicron disruption and the rising risk of a Russian invasion of Ukraine. It's too early to say markets have bottomed. Key things for investors to bear...
Key Points: Inflation is placing increasing pressure on major central banks to remove monetary stimulus. Inflation & rising interest rates will likely contribute to more volatile & constrained investment returns this year. The long-term downtrend in inflation and interest rates since the early 1980s is...