Weekly Market Update | 10 May 2023

The Reserve Bank of Australia (RBA) took the economists by surprise with its decision to raise interest rates by 25 basis points to 3.85%. Despite the release of weaker than expected quarterly inflation data, the Board considered a range of other factors, including a record low jobless rate and an impressive rebound in property prices.

Meanwhile, the Federal Reserve also met to decide on the US interest rate and raised rates by 25 basis points to a range of 5-5.25%. This increase was widely anticipated, but the markets are pricing in several cuts by the end of the year as the Fed attempts to balance stubborn inflation with growing fallout in the financial sector.

Days before the release of fresh US jobs data, which showed the US economy added 253,000 jobs in April, surprising economists who had predicted 180,000 added jobs, the rate decision was made.

In Australia, attention is on the federal government’s budget release, with a focus on cost-of-living measures expected to be highlighted amid the current inflationary environment.


GENERAL ADVICE AND PAST PERFORMANCE WARNING

This article has been prepared by United Global Capital Pty Ltd (ACN: 154 158 273, ABN: 25 154 158 273, AFSL: 496179).

This article contains general information only and is not intended to provide any person with financial advice. It does not take into account any person’s (or class of persons) investment objectives, financial situation or particular needs, and should not be used as the basis for making any investment or financial decisions. United Global Capital Pty Ltd does not make any representation as to the accuracy, completeness, relevance or suitability of the information, conclusions, recommendations or opinions contained in this article (including, but not limited to any forecasts made). No liability is accepted by United Global Capital Pty Ltd or its directors, officers, employees, agents or advisors for any such information, conclusions, recommendations or opinions to the fullest extent possible under applicable laws.

Anyone considering making any investment decisions based on the information contained in this presentation should note that past performance, target returns or estimates of returns is not a reliable indicator of future performance and actual results can vary significantly.

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