On Point

Global growth will be in focus this week, with the release of flash purchasing managers’ indices for September. We’ll also get the latest PCE inflation report in the US, which is the Federal Reserve’s preferred inflation gauge. On the central banking front, a monetary policy decision is due across the Tasman, although no change is expected. The domestic economic calendar is sparse, although there...

It’s been a difficult few years for first home buyers. Just when borrowing costs started falling in 2020, prices started rising sharply to offset any extra spending capacity buyers had. When the dust settled and prices started coming back to earth, mortgage rates had started to rise rapidly. The housing market stabilised early last year, and now we’ve seen mortgage rates start heading south. Where...

Looking ahead, this week is shaping up as a very busy one with some extremely important events taking place across markets. The Federal Reserve decision in the US will be the highlight, with the first interest rate cut of this cycle (and the first in more than four years) looming. While a 0.25% cut seems assured, markets are ascribing a 35% chance of a larger, 0.50% cut. Here in New Zealand we’ll...

Talk of a capital gains tax is back in the headlines. It’s hard to see a National-led government making any such changes to our tax system. However, it could be back on the agenda when we inevitably see a change of government. Do we need a capital gains tax in New Zealand, and what are the drawbacks of implementing such a radical change?

Inflation will be in focus in the US this week, with the August consumer price index due on Wednesday. The annual rate of increase fell below 3.0% for the first time in three years last month, and markets will be hoping for another moderation ahead of next week's Federal Reserve meeting. Markets are expecting the first Fed rate cut of this cycle, while they see a 30% likelihood of a larger 0.5...

Interest rates are headed lower, which will take the pressure off household budgets and give many homeowners a reprieve. Borrowers are right to feel more optimistic about what’s ahead, but don’t get ahead of yourself just in case they don't come down as much as you think. If the "neutral OCR" is higher than it used to be, the “new normal” for mortgage rates will be too.

It'll be a holiday-shortened week in the US with markets closed for the Labor Day holiday on Monday. However, there will still be plenty to monitor, with the latest ISM indices (for both the manufacturing and services sectors) due as well as the monthly jobs report. Closer to home, it'll be a quieter week on the corporate front now that the Australasian reporting season having wrapped up....

Gold has been one of the best performing assets these last two years, rising more than 40 per cent and even outpacing the S&P 500 index in the US. Long regarded as a safe-haven asset, it is traditionally favoured by those worried about the health of the global economy and financial system. However, gold has also proven to be a useful diversifier, making it a candidate for inclusion in mainstre...

Inflation will be in the spotlight this week with PCE inflation due in the US on Friday, ahead of the Federal Reserve's meeting next month. The latest ANZ Business Outlook survey will be the key release in New Zealand, while the corporate reporting season will continue with Chorus, Summerset, Meridian Energy and Air New Zealand set to releases earnings this week across the NZX. However, the bi...

Last week’s OCR cut received a lot of attention, and rightly so. It was the first since 2020, and it marked the end of 15 months at 5.50 per cent, the highest since 2008. That sparked the biggest two-day rally in New Zealand shares for two years, and the beginning of the easing cycle has seen the market rebound more than ten per cent from the lows of recent months. Is this optimism justified, will...

Last week was a very good one for local investors. The NZX 50 enjoyed its seventh positive week out of the last eight, rising 4.0%, the strongest weekly gain in more than four years. The index is up 10.4% from its recent lows, and at its highest level since January 2022. In the days ahead, markets will be kept busy with a busy week of corporate results, as the likes of a2 Milk, Freightways, Fletch...

The local reporting season ramps up next week, putting many of our largest listed corporates under the microscope. It’s started more slowly than usual, with only a handful of releases so far and most businesses choosing to schedule earnings announcements for the last two weeks of August. We’ve seen a rebound in the sharemarket over the last few months, with the NZX 50 index rising more than six pe...

It's a huge week here in New Zealand, with one of the most eagerly anticipated Reserve Bank decisions in recent memory due on Wednesday afternoon. The international highlights will include the July CPI report in the US, as well as retail sales for the same period. Investors will also be watching monthly activity indicators in China and a raft of economic releases in the UK. The New Zealand reporti...

It's been a rough start to August for financial markets, with US shares suffering the biggest decline in almost two years on Monday. A sharp bout of risk aversion has hit, with bond yields lower, growth assets selling off aggressively and volatility measures surging. The Japanese sharemarket has fallen 20 per cent in just three days, something we haven't seen in data going back to 1949. Th...

The US Federal Reserve left interest rates unchanged last week. However, it left financial markets in no doubt that a cut is imminent, with Chair Jerome Powell noting one might be on the table at the next meeting in September. Inflation is headed toward its target, and cracks are appearing across the economy. A recession isn’t upon us, but the risks of one might be increasing. So will September pr...

What a week! The S&P 500 fell another 2.1% last week after a surprise jump in the US unemployment rate raised the prospect of a sharper economic slowdown, or even recession. The index is down 5.7% from its mid-July peak, with high-flying sectors feeling the brunt of the selling. Technology is down 12.8%, while consumer discretionary (of which Amazon is the biggest constituent) has slipped 10.1...

August is "Money Month", an annual public awareness campaign run by Te Ara Ahunga Ora. Also known as the Retirement Commission, Te Ara Ahunga Ora is the government-funded organisation behind the Sorted website, a great resource dedicated to helping New Zealanders get ahead financially. Money Month is about encouraging people to talk more openly about money, to help us all improve our financial wel...

It’s been a pivotal month in US politics, with plenty of action since that infamous June debate between Joe Biden and Donald Trump. Biden has stepped aside and current Vice President Kamala Harris is all but assured as the Democratic nominee. How might this impact the likely outcome, and what should investors be thinking about as we head toward November?

Another eventful week looms, with all eyes on monetary policy decisions from the Federal Reserve, Bank of Japan and Bank of England. Key economic releases will include the ISM index and jobs report in the US, as well as PMIs in China. On the earnings front, big tech will be in the spotlight with Microsoft, Meta, Apple and Amazon all scheduled to report. On the local front, the ANZ Business Outlook...

The Official Cash Rate (OCR) will soon be headed lower, and this will have important implications for savers, borrowers and investors. Financial markets have taken a bolder view than most economists, and they now see at least two (but possibly three) 0.25 per cent cuts before the end of the year. A move in October or November seems assured, while there’s half a chance the Reserve Bank might take a...

It's been a busy couple of weeks! The S&P 500 fell 2.0% last week as investors rotated out of the high-flying sectors and into some of the laggards which look better value. The S&P 500 Equal Weight index has performed much better, while the Russell 2000 (comprised of smaller companies) is up 7.8% over the past two weeks. Here at home, the local NZX 50 increased another 1.6% last week, which sees i...

The latest quarterly inflation figures are out this week. These will be closely watched, in particular the domestic inflation that has worried the Reserve Bank so much in recent years. With that in mind, this popular episode from May will give you a refresher on exactly how our inflation basket is composed, why domestic inflation has been so troublesome, and the challenges of reducing it without a...

This was a popular episode from earlier in the year, and the messages are timeless to take a listen if you missed it the first time around! If you buy a share listed outside New Zealand, it’s not just changes in the share price that will determine your return. You also need to keep an eye on the exchange rate between the New Zealand dollar and the currency in question. Holding a portion of your we...

This week’s global economic highlight will be the US inflation report, while Federal Reserve Chair Jerome Powell will testify to Congress on Tuesday and on Wednesday. Markets see a 77% chance of the Fed cutting rates in September, with a cut fully priced by November. Politics will also remain in focus after last week's UK election, with investors monitoring the outcome second round of legislat...

The first six months of the year is behind us, so let's take a look at the best and worst performers, before turning to the rest of the year. The second half of 2024 is set to be action packed, and there's plenty for investors to monitor. Politics, inflation and interest rates will be in focus, so how should investors be positioned and what do we need to keep an eye on?