News
Wealth Pi Fortnightly Economic Snapshot
Interest Rates
Probability of rate increase at next RBA meeting in May 2024 is at 3% for 25bp.
RBA
Rates look to be on hold for coming months and the market is pricing rate cuts in the second half of 2024.
Australian Markets
The value of new housing loans rose 17.9 per cent since March 2023 to $27.6 billion, after a 3.1 per cent rise in the month, according to data released today by the Australian Bureau of Statistics (ABS).
Global Markets
US:
Subsector moves a combination of earnings-related catalysts, along with lower rate tailwinds. Unsurprisingly, Towers led, with AMT up big after raising FY guidance and garnering an upgrade, buoying the group; SBAC lower on the week following Q1 miss and guidance cut. Self-Storage also higher, with EXR a standout, as results better than feared; lower rates also associated with improving housing market outlook and increased demand driver for the segment.
UK:
From a macroeconomic calendar perspective, focus on the Nationwide house price index, which showed a slowdown in annual house price growth in April. Prices down 0.4% m/m vs consensus for 0.2% gain and prior 0.2% drop. Left annual gain of 0.6%, below 1.2% forecast and prior 1.6% gain. Nationwide highlighted slowdown likely reflects ongoing affordability pressures amid the recent rise in longer-term interest rates, which reversed the steep drop at the start of the year. Noted house prices ~4% below all-time high. While updates from Nationwide and Halifax have pointed to slower rate of price growth in the last two months, underlying dynamics remain positive.
Property
An article from Corelogic discusses Australia’s migration hubs and housing trends. It concludes that understanding migration patterns is vital for navigating the real estate market. Major cities like Melbourne and Sydney experience significant population growth, influencing demand for housing. This insight is crucial for policymakers and investors to anticipate market dynamics and make informed decisions.
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