With the ASX last week announcing that it is allowing bond ETFs to trade on the market, financial planners have the last basic building block in place to recommend portfolios that are completely listed covering all major asset classes. Previously listed portfolios were limited to equities (local and global of varying strategies) and commodities. With …
Tag Archive: fixed interest
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Jan 10
The change in outlook for the 2011 Australian Economy in one picture
Source: RBA The above chart shows pretty much what happened to the outlook for the Austrlaian economy and why bonds were the best investment for the year. It shows the longer terms yields (3 years and above) dropping by up to 200bps thus providing very large capital gains for bond investors who had the courage …
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Dec 25
Corporate Credit…maybe
Source: RBA Despite the above chart being a few weeks old, the above chart shows credit spreads have widened significantly over the past few months such that at the end of November, both A and BBB rated corporates have spreads in excess of 300bps. When you consider that the historic default risk is much much …
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Dec 19
Australian Government Bond Yields…there’s now a 2 there
Source: Bloomberg & RBA Thought I’d check the Australian Government Bond yield curve to see if the market is confirming my bearish sentiment on the Australian economy and it looks like it is. 3 Year bond yields have dropped below 3%…that’s an ugly indicator for our economy. Send article as PDF
Dec 07
Australian Government Bond Yield Curve…no change in 2 weeks
Source: RBA As the above chart shows the yield curve dropped significantly from the start of August through to towards the end of November and at the end of yesterday after the RBA dropped the cash rate another 25bps to 4.25%, the yield curve is basically the same as it was two weeks ago. Whilst …
Nov 24
Australian Government Bond Yields…seriously low
Source: RBA Just when you think the yield curve can’t get any lower, the last 8 days have taken another 10 to 15bps off. Sharemarkets have obviously dropped on the Euro-debacle and this yield curve demonstrates not only significant interest rate reductions in the months to come but a significantly slowing Australian eonomy thanks to …
Nov 03
Australian Government Bond Yields…more rate cuts to come?
Source: RBA In just 3 business days the yield curve has dropped down to where it was at the end of September where markets had experienced eight weeks of gloom and doom. Mind you, a lot happened in the three days to the end of yesterday…including the Greek’s putting significant doubt in the Euro rescue …
Oct 29
Term Deposit Premium very high again
Source: Reserve Bank of Australia The above chart shows the premium banks are paying for their 3 year term deposits compared to 3 year Australian Government bonds from 1992 to the end of September 2011. Since hitting its aboslute high around the start of 2010 and peaking again around July 2010, term deposits are paying …
Oct 29
Australian Government Bond Yields…small improvement
The last month has shown a bit of a bounce-back in the sharemarkets but as the above yield curve indicates, so far its more of a dead cat bounce and there’s a long way to go. The yield curve is still negatively sloping to beyond two years indicating the market is expecting a few rate …
Sep 27
Slight rise for Australian Government Bonds over last 2 weeks
Source: Bloomberg, RBA The above chart uses price from this morning for the 28 September data and as it shows there has only been a slight improvement in the yield curve over the last couple of weeks so really no significant impact on troubled beliefs at this point in time. Overnight the equity markets were …