Market Update July 2012
We saw uncertainty in world markets once again this month as news swinged between promising and concerning.
Concerning news stemmed from US and China reporting weaker than expected GDP growth and unemployment and in the case of China, the first ever interest rate cut since the Global Financial Crisis.
In contrast, we saw some great efforts made in Europe to ease bank funding pressures and a commitment by European Union leaders to support the economy with a €120 billion growth pact announced. Markets rallied following the announcement.
In Australia, markets remained positive relative to the rest of the world with the Reserve Bank of Australia maintaining the current cash rate, and the Budget Stimulus starting to be passed out across households in May and June. The Australian Dollar (AUD) gained 5.31% against the US Dollar (USD) in June, reflecting RBA’s positive outlook and the expectation of no further interest rate cuts for July.
As markets continue to remain uncertain in the short term, please remember to remain focused on your long-term goals.