Economic and market news
The Reserve Bank of Australia raised its official interest rate for the eighth consecutive month. The 0.25 percentage point increase took the official rate to 3.1 per cent, the highest since December 2012. In his statement, the Governor again stressed the importance of ensuring that the current period of high inflation is only temporary. Commentators noted that this is the fastest tightening cycle for monetary policy in Australia in a generation. Financial markets were said to be pricing in a further two interest rate rises next year, which would take the official cash rate to 3.6 per cent.
New monthly inflation data show that prices increased 6.9 per cent in the year to end-October 2022. This outturn was well below expectations, and reflected an fall in food and grocery prices. However, commentators cautioned against seeing this as the peak in inflation, given the potential of further energy prices rises to be passed through, and the yet-to-be-seen impact of inland eastern state floods on the prices of fruit and vegetables.
In overseas economic news, strong jobs and average earnings data tempered hopes that the US Federal Reserve has ‘tamed’ inflation, and thus expectations of a flattening in the trajectory of official interest rates rises.
It was reported that an increasing number of Chinese cities are loosening COVID restrictions in the face of broadening protests over the last week.
Australian indices
ASX 200: Rose 0.53 per cent, over the week, to 7291.3 points at the close on Tuesday.
All Ordinaries: Also rose, 0.61 per cent in the past week, closing at 7487.7 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
|
94.69 |
3.06% |
+9 |
-20 |
+243 |
|
GTAUD5Y:GOV Australia Bond 5 Year Yield |
2.75 |
98.02 |
3.18% |
+6 |
-34 |
+192 |
|
GTAUD10Y:GOV Australia Bond 10 Year Yield |
1.75 |
86.20 |
3.39% |
+3 |
-46 |
+181 |
|
GTAUD15Y:GOV Australia Bond 15 Year Yield |
3.25 |
94.50 |
3.68% |
+2 |
-46 |
+180 |
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) |
|
3.10 |
+0.25 (6 December 2022) |
+0.25 (6 December 2022)
|
0.10 |
Currencies (source:RBA)
As at the close on 6 December, AUD/USD had risen 0.37 per cent on last week, to 0.6731. The AUD/RMB fell 2.19 per cent in the week to 4.6978.
Commodities
Oil prices were said to have ‘bounced’ on Monday after a decision by OPEC to maintain its current production levels.
Venture Capital
Cardihab
Stoic investee Cardihab has talked about the take up of its home-based, digital cardiac rehabilitation program by remote and regional patients in recovery, through a partnership with Mater Private Hospital Townsville.
Morse Micro
Congratulations to Stoic investee Morse Micro who were nominated by WiFi NOW for Best Wi-Fi Startup and Best Wi-Fi IoT Product.
Property
This week, new data show that 8 out of 10 suburbs across Australia have posted falls in house prices over the past three months. However, there are also signs that the market drops could be coming to an end, with the number of residential properties going to auction edging up, while the clearance rate has been maintained. This led commentators to speculate that market confidence is returning, and that that may mean that the market has bottomed, despite the prospect of further interest rate increases.
