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MARKET COMMENTARY

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Re-opening with Hope

May 26, 2020

6:29 am

• Economic data displays fewer really bad surprises • Some country and sector rotation within equity markets • Emerging market debt showing good momentum • India – a market waiting to perform • Chinese assets with domestic support but international challenges We would frame the current market phase as a ‘re-opening filled with hope’. Markets…

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Monetary Policy Update

May 23, 2020

1:32 am

Repo Rate Cut by 40bps; Moratorium Extended The Reserve Bank of India (RBI) in an unscheduled monetary policy committee (MPC) meeting today reduced the policy repo rate by 40bps to 4%, the lowest in last two decades. The MPC judged that the risks to growth are acute, while the risks to inflation are likely to…

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This Challenging World

May 18, 2020

10:03 am

• Unprecedented rise in government deficits and indebtedness globally • New Zealand announces a budget worth a staggering 17% of GDP • Global debt to GDP set to rise to 108% • Governments and central banks will have to be creative to keep the potential damage to bond markets in check • How far off…

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V versus U

May 11, 2020

7:20 am

• The grind higher in US equities appears to back the V-shaped recovery view • A possible 25% unemployment rate would signal a U. • We should remain cognisant of the massive relief provided to households • Will households save or spend their ‘Trump’ cheques? … History suggests saving • Some US equities have seen…

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