Economic and market news
The International Monetary Fund was said to have downgraded its economic forecasts for Australia in light of the reduced outlook for the global economy. In its latest World Economic Outlook, the IMF apparently says that the chances of a ‘hard landing’ for the global economy have risen sharply, with inflation predicted to stay higher for longer and risks in the financial sector elevated amid the fallout from the collapse of Silicon Valley Bank last month.
In contrast, new data show further signs of resilience in the Australian economy, with unemployment in March remaining steady at 3.5 per cent, close to its 50-year low. Employment remained strong, with 53,000 more people in jobs. Labour force participation was up again, with female participation increasing to new record highs. Growth in hours worked continues to outpace employment increases. Since March 2020, hours worked have increased 8.4 per cent, compared to a 7.0 per cent increase in employment.
It has been revealed that the Chinese economy grew 2.2 per cent in the March quarter, and 4.5 per cent year-on-year. This reflected the lifting of COVID-19 restrictions, triggering a rebound in factory and consumer activity since January. However, economists are reportedly concerned the growth momentum cannot be sustained.
In the United States, inflation reportedly fell to an annual rate of 5 per cent in March. This was down from 6 per cent in February, and the smallest year-on-year gain since May 2021. Annual CPI peaked at 9.1 per cent in June 2022, and has now declined for six months in a row, as last year’s large rises drop out of the calculations. However, commentators and markets are still pricing further official interest rate rises, in order to attain and then lock in ongoing ‘price stability’ – considered to be around 2 per cent inflation.
Australian indices
ASX 200: Rose 0.69 per cent this week, to close at 7360.2 points on Tuesday.
All Ordinaries: Rose 0.71 per cent in the week, closing at 7557.5 points on Tuesday.
Government Bonds
Government Bond Yields (Source: Bloomberg)
|
NAME |
COUPON |
PRICE |
YIELD |
1 DAY |
1 MONTH |
1 YEAR |
|
GTAUD2Y:GOV Australia Bond 2 Year Yield |
3.25
|
100.26 |
3.11% |
+10 |
+8 |
+109 |
|
GTAUD5Y:GOV Australia Bond 5 Year Yield |
2.25 |
95.64 |
3.18% |
+10 |
+6 |
+56 |
|
GTAUD10Y:GOV Australia Bond 10 Year Yield |
4.50 |
108.62 |
3.47% |
+10 |
+8 |
+50 |
|
GTAUD15Y:GOV Australia Bond 15 Year Yield |
3.25 |
93.14 |
3.80% |
+9 |
+6 |
+66 |
Reserve Bank of Australia (Source:RBA)
|
RBA CASH RATE TARGET (RBATCTR:IND) CURRENT (per cent) |
MOST RECENT DECISION (percentage points) |
MOST RECENT CHANGE (percentage points) |
1 YEAR PRIOR (per cent) |
|
3.60 |
No change (4 April 2023) |
+0.25 (7 March 2023) |
0.10 |
Currencies(source:RBA)
As at the close on 18 April, the AUD/USD had risen 1.01 per cent in the week to 0.6733. The AUD/RMB also rose, 0.65 per cent, in the period, to 4.6265.
Venture Capital
Forcite
Stoic investee Forcite has made it to 2023’s list of finalists for the Australian Web Awards in the ‘Matter Design & Digital’ category.
Jayride
Stoic investee Jayride is predicting the biggest summer ever for travel in the northern hemisphere. Co-founder and managing director of Jayride Rod Bishop talked to Ausbiz this week about the business and travel industry.
Morse Micro
Stoic investee Morse Micro announced that its partner Quectel has launched its new FGH100M Wi-Fi HaLow module that is based on their Wi-Fi HaLow SoC. The Morse Micro techenables lower power connectivity than previous Wi-Fi technologies and is able to support coin cell battery devices to operate up to several years.
Property
The growth in the cost of building a new home has reportedly slowed to the lowest level in two years. New data was said to show that inflation in the sector, which was ‘rampant’ since the start of the pandemic, slowed to only 0.9 percent in the March quarter. This was less than half of the 1.9 per cent rise recorded in the previous quarter and the lowest quarterly gain since March 2021 (0.8 per cent). This brought the price rises over the 12 months to March at 10.9 per cent, down from 11.9 per cent in the year to December. However, it was noted that this is still three times higher than its pre-COVID five-year average of 3.6 per cent.
