Economics

Governor Philip Lowe acknowledged some missteps in the central bank’s strategy on inflation during his tenure and said while the inflation target is now in view, further rate hikes may still be necessary to complete the bank’s important task.

The legendary investor says we’re in the midst of the third major shift he’s seen in his 50-year career, as a decades-long low-interest-rate environment shifts to something most investors have not yet experienced. It’s a new world in which credit investors – and especially bargain hunters – should thrive.

The steepest rate-hiking program in history has largely done its job, but softening inflation may not translate to an immediate pivot on official rates as cautious central banks seek a comfortable buffer, says Neuberger Berman.

Signs of rising economic optimism in Australia don’t change the narrative on the risk of recession, and chances remain very high for a deep downturn in Australia, according to a new report.

Bill Evans, who will step down next year after three decades as Westpac’s chief economist, says “deeply pessimistic” consumer sentiment despite the RBA’s recent pause is a sign of further hikes ahead.

While markets expected a pause, the RBA board’s hawkish tone implying a further cut in August surprised many. For Australia’s property sector in particular, observers say the path to a soft landing may be getting even more treacherous.

The giant tech companies that have dominated the equity rally are showing signs of slowing growth, prompting crowding and valuation risk for investors. According to Bell Asset Management’s Ned Bell and Redwheel’s John Malloy, it could be a “pivot moment” for equity markets.

With ETF providers offering a slew of products aimed at shipping exposures, the ‘esoteric legend’ of the Baltic Dry Index still has a place in the hearts and minds of investors.

After a punishing innings for her flagship ETF, ARK Invest founder Cathie Wood thinks investors need to stop living in the 70s. This time next year the Fed will be “running in the opposite direction” and deflation will dominate the market, she says.

In a recent market update Sage lamented the RBA’s recent decision to re-engage interest rake hikes after pausing only a month earlier. Policy outcomes have become confusing, the fund manager noted, with the path to a soft landing becoming even narrower.

Turbulent markets make it timely to review three growth businesses that boast strong free cash flow and robust balance sheets for volatile times, writes Francyne Mu, portfolio manager at Franklin Equity Group.

While active can provides pockets of outperformance both here and globally, research from S&P Global suggests maintaining above-benchmark returns is difficult to maintain.