Information on this website does not constitute financial product advice and does not constitute an offer or endorsement or opinion in respect of the matters included.
For Australian Investors information only, not for distribution in the United States.
Commodities rallied around 20% as China’s stimulatory policies finally kicked in. Economic activity in China is finally showing signs that interest rate and Reserve Rate cuts are working. Large increases in credit and social financing has seen some property market recovery. Infrastructure projects are coming online, and steel producers have fired up furnaces and started production. Iron ore finished 23% stronger on increased demand, but also speculative trading by retail investors.
Stronger commodity prices helped the ASX200 3.4% higher.
The Bank Of Japan disappointed with no further announcements of stimulus at their April meeting, leaving their equity market weaker and the Yen stronger.
The US Federal Reserve left rates on hold and seemed “dovish”. The accompanying statement noted market conditions as better, but seemed somewhat concerned about the weak growth print for the first quarter of 2016 (0.5% Q1).
Australia witnessed its weakest inflation print since the Global Financial Crisis at -0.2%. The weak number meant the inflation rate fell below the RBA’s desired 2-3% band, and left the door open to a May interest rate cut.
The Australian dollar rallied to 78c US, but sold off 2c after the weak inflation data.
