by Sharemarkets have continued their steady climb over the quarter, particularly international shares that have exposure to the “magnificent seven” US companies. Bonds have continued to struggle, with interest rates remaining elevated. The inflation outlook for Australia is taking a different path relative to many other developed market economies. This could be partly due to our peers increasing rates earlier and more aggressively as well as fiscal conditions in Australia supporting inflation.
The US labour market figures is pointing to a slowing economy and the general consensus is that the Federal Reserve will reduce rates at their September meeting. Conversely, the Reserve Bank of Australia will await 2Q24 data in late July to consider whether to lift interest rates at the August meeting in order to address our stubbornly high inflation.
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