Investor Signposts: Week Beginning March 6 2011

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The big picture The Reserve Bank Governor isn’t one to gloat. But you can certainly sense from the latest interest rate decision that Glenn Stevens is pretty pleased with the state of the economy. Of course it is not just the Governor that can take credit for our laudable circumstances, it is the Reserve Bank […]

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Businesses bank on second half recovery

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Private New Capital Expenditure; Average weekly earnings New business investment rose by a less than expected 1.3 per cent in the December quarter. Manufacturing dominated investment plans with investment in the sector up by 7.0 per cent as opposed to mining investment which fell by 4.8 per cent in the December quarter. Businesses expect to […]

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Hedge now, gain later

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Businesses urged to consider hedging strategies ahead of expected dip in value of Aussie Businesses that rely on importing goods or services are being urged to consider hedging strategies in the first quarter of 2011 to make the most of the current high Aussie dollar – and mitigate against any adverse impact of expected decreases […]

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US to launch second wave of quantative easing

The potential for policy shifts in the US economy has been the pivotal driver in financial markets ever since Fed member Bullard surprised investors early in the summer by floating the prospect of the printing presses rolling again. After what has seemed an eternity, the US Federal reserve confirmed last night that they will launch […]

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Global Property Securities Update

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Overview Strong returns by listed property companies during the month were mainly driven by positive momentum in most global equity markets. The prospect of further quantitative easing in the US would be beneficial to property companies. Asset valuations would improve because the lower risk-free rate tends to cause capitalisation rates to have adownward bias. We […]

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The new age of consumer thrift

Key points The GFC has ushered in a period of more cautious consumers in the US and to a lesser extent in Australia. Household savings rates are likely to be higher than over the last decade as households seek to cut debt ratios in the face of reduced credit availability, greater economic uncertainty and constrained […]

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The return outlook for unlisted commercial property

Key points Unlisted commercial property prices have started to grind higher after a 20% slump through 2008 and 2009. Expect a continuing but gradual recovery in returns going forward on the back of attractive yields and constrained office supply, but only modest growth in space demand reflecting the somewhat mixed nature of the economic recovery. […]

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Global Reflation Mark II, gold and the Australian dollar

Key points The sub-par recovery in the US, Japan and Europe and constrained fiscal policy most likely means that we will see another round of global policy reflation, centred on quantitative easing (or printing money). This will be bad news for G3 currencies, but good news for Asian currencies and gold. And it will likely […]

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Emerging markets local currency debt: Capitalising on improved sovereign fundamentals

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Emerging markets local currency-denominated debt is a relatively large and liquid asset class that represents some of the most creditworthy emerging market sovereigns, offers two distinct sources of return (currency and local bond yields), and provides the potential to generate equity-like returns without taking on direct equity risk. We expect the sizeable growth differentials between […]

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