Market insights

On Tuesday 14 May, Treasurer Jim Chalmers is set to hand down the 2024-25 Australian Federal Budget in Parliament.

It’s becoming clear that businesses are responding to the dual pressures of slower growth in spending and reduced pricing power by boosting productivity.

The economy is slowing, and inflation is on its way down. But whether the RBA can get the balance right and achieve a soft landing remains to be seen. Businesses could be key to achieving this outcome.

Financial markets have become increasingly convinced that the Federal Funds Rate has reached a peak in this cycle. These views were cemented after the Federal Reserve’s final meeting of 2023.

The record wage boost was supported by several Fair Work Commission decisions, which were well known in advance and unlikely to be repeated. We therefore do not expect the Reserve Bank to respond to the strong read.

The impacts of the pandemic have been enormous. They forced new ways of living to emerge and accelerated many trends that had already been growing in the years prior. Few sectors have been unaffected. Commercial property supply-and-demand dynamics have been altered by transformational changes to the way we live, work, shop, and do business. These have lasting implications for risk and return. Read our article for more detail.

The June quarter National Accounts confirmed the economy is slowing, and we expect to see further slowing from here. This means the next move in the rate cycle is likely to be down, in the second half of next year, when it becomes clear the economy needs policy support.

The Reserve Bank (RBA) Board left the cash rate unchanged for the second straight month at 4.10%. Over the last five months the RBA has left rates on hold on three separate occasions. This shows that we are at or near the cash rate peak.

The disinflationary process that has been underway for some time overseas is working its way through the Australian economy as inflation continued to slow in the June quarter.

Inflation slowed to 5.6% in May, from 6.8% in April. However, underlying inflationary pressures barely budged when stripping away volatile items and holiday travel. This complicates the picture for the RBA and suggests more tightening may be required.

With the end of the current financial year fast approaching, BT is sharing the top questions advisers are asking its technical team.

The Hon Dr Jim Chalmers MP, Treasurer has handed down the new 2023-24 Federal Budget. BT Technical Services team have analysed the budget announcements and have produced briefing documents outlining the major changes impacting financial advisers and their clients.

The Australian labour market has consistently been one of the standout performers in the economy through this cycle. This strength continued in March, as 53k people were added to the labour force in the month. Strong labour demand has been met by a surge in labour supply, as migration has rocketed to its highest levels on record. But what about the future labour market outlook? And what will the RBA make of this strength?

It’s a quiet week for domestic data this week, providing a moment of calm before the March quarter inflation report is dropped next week. This release has the potential to cause some disruption in markets as the inflation print will likely be the deciding factor in the Reserve Bank’s (RBA) May policy decision. Markets are currently pricing little chance of another hike in May, meaning an upside surprise to inflation could prompt some outsized moves in market pricing.

In the wake of the Final Report from the Quality of Advice Review, Matt Rady, CEO at BT, outlines why its incumbent on the industry to work together to push for meaningful reforms to financial advice to help people build a better financial future.

The central banks of the US, UK and Europe held their nerve last week and pressed on with rate hikes despite turmoil in the banking sector and considerable financial market volatility. These developments themselves tighten financial conditions and led to speculation that central banks could pause rate hikes.

Over time, we expect the technology that underpins platforms will evolve to provide even more support to advisers so they can help more clients in more ways. At BT, our aim is for platforms to make advisers’ lives, and the advice process, even easier. Richard Holmes, Chief Information Officer, shares our vision for some of the features advisers will likely be able to access through platforms in the future.

In October 2022, BT hosted ten successful financial advisers on a study tour of the United States. The 2022 BT USA Study Tour revealed many insights into financial planning in the US and Australia, as they met with senior leaders of the US industry and compared notes.

The Reserve Bank (RBA) Board delivered another 25-basis-point hike today, taking the cash rate to 3.60% – the highest level since May 2012.

The issues facing advice firms have been covered extensively in the past couple of years, all boiling down to a need for increased efficiency to maintain profitability. To achieve this, businesses will need to streamline and innovate. Knowing which issues are causing efficiencies and the specific pain points is key to making meaningful progress.

Growth in wages over the December quarter were weaker than even the most pessimistic market forecast. Wages grew by 0.8% over the quarter. This was a clear deceleration from the September quarter and marginally lower than the June outcome. So, What does all this mean for the Reserve Bank?

The Reserve Bank kicked off 2023 with another 25-basis-point hike this week, lifting the cash rate to 3.35%. In addition, the RBA provided hawkish guidance all but confirming that more hikes are on the horizon. Importantly, the statement’s key final paragraph suggested that the RBA thinks that two more hikes will be required, if not more.

While we had mostly learned to live with the lingering impact of COVID-19 as we entered 2022, an unexpected invasion of Ukraine by Russian armed forces reignited market uncertainty and by the end of the year, record levels of inflation had hit the world’s major economies.

It’s never been more important to invest in digital technologies. Here are 3 steps to help you achieve a successful digital tech implementation.