Merry Xmas! and December Market Update
On the whole, the global economy looks to be heading the right direction however, questions still remain over a number of major economies. Strong projected resource investment figures in 2011 and 2012 saw the Reserve Bank of Australia (RBA) raise the interest rate to 4.75%. Also fuelling this decision was the RBA’s concern about the medium-term outlook for inflation. In Europe, the focus in November was on sovereign debt concerns, especially in Ireland. With the economy sinking and unemployment hitting 13.6%, a bailout package has been announced despite initial resistance from the Irish Government. In the US, the Federal Reserve Bank justified the announcement of QEII – the second round of quantitative easing, to ensure the stability of the US recovery. And in China, authorities remain committed to reining in inflationary pressures. As a long-term investor, it’s important to keep in mind that we can probably expect to see more volatility as global markets work towards a sustained recovery. If you’d like to discuss anything in this report please give my office a call. Finally, I wish you a Merry Xmas and a Happy and Prosperous New Year!