I was fortunate to have been given a couple of amazing tickets to the NRL grand final – a big thank you to my cousin Chris. What an experience. As a diehard Panthers supporter since my dad took me to my first match in 1967, being at the ground for their worst ever loss of 70-7 against Manly in 1973, spending many an afternoon with mates on the hill in the early 80’s (some wins but more losses) I have never once thought of changing teams even though I moved away from the Penrith area in 1999. Being able to watch every Panther’s match on Kayo over the past 2 years has been my non-negotiable sanity check. Had an amazing day with my mate Greg, and an added bonus I caught up at the pub before the match with some mates from my Penrith days I haven’t seen for over 10 years.
In September, persistently high inflation and aggressive rate hikes by the world’s central banks put global share and bond markets under pressure. The US Federal Reserve has lifted rates seven times this year, but US inflation remains at 8.3%. There is now growing fear that central banks may push the world into recession. In a surprise twist, the Bank of England (which has also lifted rates seven times this year) was forced to switch back to Quantitative Easing, buying government bonds to support the British pound which crashed to a record low in response to a stimulatory mini-Budget released by the new Conservative Party leadership. This led to a late relief rally on global share markets and a fall in the US dollar and global bond yields. Even so, major global share markets finished the month down 6% or more.
In Australia, the picture is a little brighter. Economic growth was up 3.6% in the year to June. Company profits are also strong, up 28.5% in the year to June, and unemployment remains low, at 3.5% in August. While inflation eased from 7% in July to 6.8% in August, due to falling petrol prices, it is still well above the Reserve Bank’s 2-3% target. Aussie consumers continue to spend at record levels, pushing up retail spending by 19.2% in the year to August, and petrol prices are set to increase by at least 22c a litre after the reinstatement of the fuel excise. Both will put upward pressure on inflation and interest rates. The Aussie dollar fell more than 3c against the surging US dollar in September, to US65c.
The Reserve Bank surprised the market a bit with the October rate rise of 0.25% (most people were expecting another 0.5% increase). Later this month we have the first budget of the Labor Government – lets see what they’ve been working on for the past few months.
