The Highlights:
- The US Federal Reserve (Fed) signalled its strongest intention yet to provide interest rate relief at its upcoming September meeting, contingent on continued moderation in economic conditions.
- Shares and fixed interest (bond) markets pushed higher in July as investors anticipated interest rate cuts, driven by signs of cooling growth and easing inflation pressures.
- International shares broadly extended recent gains, but investors rotated out of high-flying mega-cap technology companies and into rate-sensitive sectors as earnings results fell short of lofty expectations. Meanwhile, softer inflation data in Australia, which almost rules out the potential for another rate hike, sent Australian shares soaring to record highs.
- Falling bond yields provided a favourable environment for both global and Australian bond returns, with government bonds and corporate bonds (credit) performing in line with each other.
Read the update here: Monthly Market Update – July 2024