Spring 2024: Financial and Market Update
Welcome to Spring 2024! As the warmer weather arrives, it’s a great time to think about personal, business, and financial renewal. At Mobius Wealth Management, we hope this season inspires you to review your financial goals and take steps toward a prosperous future.
Global Stock Markets: Stability Returns After a Volatile August
Global stock markets, including the Australian Securities Exchange (ASX), stabilised by the end of August after a volatile start to the month.
Early in August, markets dipped following reports of higher unemployment in the United States and a surprise interest rate move by Japan’s central bank. Despite these global financial challenges, the S&P/ASX 200 index finished the month 1.28% higher, bringing the index to a total gain of just over 10% for the past 12 months. This recovery has provided some reassurance for Australian investors.
Inflation Eases, But No Interest Rate Cut Expected
In positive news, Australia’s inflation rate eased slightly to 3.5% in July, down from 3.8% in June. This decrease has many investors watching the Reserve Bank of Australia’s (RBA) response, although most economists agree that there will be no interest rate cut in 2024. The RBA forecasts inflation won’t return to its target range until late 2026 or early 2027.
Cost of Living and Wages: Encouraging Signs
While the cost of living in Australia has only slightly improved, thanks in part to the federal government’s $300 electricity bill rebate, there is more good news on the wage front:
- The Australian Bureau of Statistics reported a wage increase of 4.1% in the year to June 2024.
- Wage growth now aligns with the rising cost of living, offering some relief to Australian households.
Consumer Confidence Begins to Rebound
These positive developments in stock markets, inflation, and wages have contributed to a modest improvement in consumer confidence. While Australia continues to recover from the economic impact of Covid-19, the signs of financial stability and gradual improvement offer hope for a stronger future.
Read more from our Spring 2024 update here.
