RBA cuts; Bonds do nothing; What’s going on?

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Introduction 24 hours before the Reserve Bank of Australia (RBA) handed down its decision to cut rates 25 basis points, I was questioning whether the RBA would cut in June. Today, I’m questioning how many more times will they cut this year. There’s a first time for everything The RBA has now cut rates to […]

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Nikko AM appoints credit analyst to fixed income team

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Nikko Asset Management Australia (Nikko AM) has appointed Linda Luo to the newly created role of credit analyst within its fixed income team. The appointment brings the number of members of the fixed income team in Australia to five permanent, full-time employees. Ms Luo will be based in Sydney and will report to John Sorrell, […]

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Australian housing – Still waiting for the decline

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Over the past five years, multiple forecasters have called the decline of Australian housing only to see prices continue moving from strength to strength. Indeed, some global investors are watching for a downturn as this could foreshadow a decline in other developed markets. In this article, we identify the fundamentals that have supported Australian housing […]

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Five charts to watch: Will these commodity gains last?

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As commodity prices have risen, the Australian economy is set to benefit from these continuing gains. Over the next two quarters, this should provide positive economic outcomes, with the important question now being – can this last? Rising commodities and a stable AUD should see tradeables inflation return Tradeables inflation represents 40% of the Australian […]

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3% is the new 5% for the Australian cash rate

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Over the past five years, the Reserve Bank of Australia (RBA) has cut the cash rate from a high of 4.75% in 2011 to a low of 1.50% in August 2016. During this period, Australian households have borrowed increasingly large amounts of debt, which are being financed at lower and lower rates. One consequence of […]

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Which matters more – Fundamentals or QE?

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Nikko Asset Management Australia’s fixed income team is continuing its effort to determine if credit spreads are close to the top. In this article, we focus on what is more important for credit spreads in the current environment: the fundamentals or central bank actions? Our research suggests that since 2010 the answer has been central […]

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Corporate profits – Can the US go it alone?

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US corporate profits have been going sideways since 2013, with both domestic receipts (share of profits emanating from US) and foreign receipts (share of profits emanating from the rest of the world) struggling to make new highs. With the US Federal Reserve (Fed) likely to start an interest rate tightening cycle this year, it begs […]

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