Economic and market news
In Australian economic news, unemployment rose in July, by 0. 2 percentage points, to 3.7 per cent. This was said to be because the number of people in work fell by 14,600, and unemployment increased by 35,600. The data were seen as the strongest sign yet the Reserve Bank’s rapid interest rate rises are starting to cool the red-hot labour market. However, it was noted that it is the third time this year the jobless rate has hit 3.7 per cent, ahead of it then sliding back down to multi-decade lows.
As part of the corporate earnings reporting season, major Australian supermarket Coles indicated that it sees food price pressure easing. It highlighted that fresh produce prices are falling, although it noted that baked goods, grocery items and dairy products remain expensive.
The Federal Government published its latest Intergenerational Report, in which it forecasts that annual economic growth will average 2.2 per cent over the next 40 years. This would be be the slowest since World War II, and 0.9 percentage points lower than the average over the past 40 years. The expected ongoing degradation in economic performance was said to be due to an ageing population and slower population growth. It was also suggested that it is likely to put pressure on governments to reform taxes, show budget discipline, and lift productivity, workforce participation and migration rates.
In overseas news, the People’s Bank of China made further changes to its official interest rates. However, it was reported that markets had been disappointed in that the decision not to lower the rates that are key to domestic mortgage rates.
Australian indices
ASX 200: Fell again this week, by 2.51 per cent, to close at 7121.6 points on Tuesday.
All Ordinaries: Also fell, 2.31 per cent, closing at 7346.4 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 |
0.25
|
92.17 |
3.93% |
+0 |
-8 |
+95 |
|
GTAUD5Y:GOV Australia Bond 5 Year Yield |
2.75 |
94.19 |
3.98% |
+1 |
+9 |
+69 |
|
GTAUD10Y:GOV Australia Bond 10 Year Yield |
3.00 |
89.55 |
4.27% |
+1 |
+26 |
+75 |
|
GTAUD15Y:GOV Australia Bond 15 Year Yield |
3.25 |
85.77 |
4.51% |
+0 |
+31 |
+78 |
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) |
|
4.10 |
No change (1 August 2023) |
+0.25 (6 June 2023) |
1.85 |
Currencies (source:RBA)
As at the close on 22 August, the AUD/USD had fallen further this week, 1.46 per cent, to 0.6417. The AUD/RMB also fell again, 1.32 per cent in the period, closing at 4.6772 on Tuesday.
Venture Capital
Forcite
Co-founders of Forcite Alfred Boyadgis and Julian Chow welcomed the NSW Minister for Roads John Graham to their state-of-the-art R&D and production facility. Forcite Labs sits within the Australian Motorsport Innovation Precinct - a high-tech cluster based at Sydney Motorsport Park. The Lab will ensure that the Forcite team can continue the important work to design, build, and test the future of motorcycle technology. They will now be able to ride out of the door of the R&D lab straight onto the track!!
Morse Micro
Stoic investee Morse Micro has celebrated its seventh birthday. In seven years it has grown from two to177 people, and is now the largest independent Wi-Fi company in the world. The Morse Micro team say they are ready for the next challenges, wins and all that comes with transforming the world of the internet of things!
Property
Stoic investment partners Elanor Investors Group announced that it has welcomed Leura Gardens Resort in the World Heritage-Listed Blue Mountains National Park to its Elanor Hotels portfolio.
