The Reserve Bank of Australia has again paused on raising the official cash rate leaving it unchanged from 4.10 %. In his statement on Tuesday the RBA governor Phillip Lowe stated that he expected Australia’s CPI inflation “will continue to decline, to be around 3.5% by the end of 2024.” An observation by senior APAC… Continue reading The Spanish Solution
The relentless monetary tightening cycle by the Reserve Bank of Australia continued, despite economic growth groaning under the strain of prior hikes. Much like the Maroons piling on the pressure on the Blues in the State of Origin on Wednesday night. The economy is demonstrating classic signs of reaching a tipping point and a policy… Continue reading Hard Landing Ahead?
After a record 350 basis points of rate increases, the Reserve Bank of Australia on Tuesday wisely paused their monetary policy tightening cycle at 3.6 per cent. A position that we predicted that the RBA would take in an earlier post. This level also matches their internal scenarios that suggested about 1 in 7 Aussie borrowers,… Continue reading Has the RBA paused the interest rate tightening cycle, or is it permanent?
This week the Reserve Bank Board’s minutes were released from their meeting on Tuesday, 7 March. One of the key points from the meeting was that the Board only considered the case for a 25-basis point increase, discarding both holding interest rates or a 50-basis point increase. The minutes noted that “Members agreed to reconsider… Continue reading RBA to pause in April
What a week it has been Silicon Valley Bank going under, and Credit Suisse apparently teetering on the brink. One thing that might be hard for most Australians to comprehend is that the Americans have one bank for every 70,000 people, compared to our ratio of one bank for every 260,000 people. While this has… Continue reading Silicon Valley Bank
This continues my earlier piece on business strategy, now there are three main business strategies exist. A cost strategy such as competing on having lower prices than your competitors examples of that could include Aldi, Bunnings and Office works. Whereas, a differentiated product or service strategy means identifying a product or service that you could do… Continue reading Case Study: PayPal
The Reserve Bank of Australia (“RBA”) Board meets tomorrow and, it’s highly likely that the Board will raise the official cash rate by 25 basis points from 3.10% to 3.35%. If we look at the Board’s December decision to raise interest rates, they said the following. “The Board expects to increase interest rates further over… Continue reading Interest rates set to rise
The potential for an American recession has increased with the Federal Bank’s interest rate hikes over 2022 and, it’s negative impact on share prices. This makes it likely that the American economy will experience a recession during 2023. If we look at the bond market, which usually provides the best indicator, then the market has… Continue reading Risk of an American Recession