Weekly Market Recap
Week in review
- Australian CPI inflation rate 0.9% q/q in 4Q20
- Australian business conditions rises to 14.2 for December
- U.S. real GDP 4.0% q/q annualized in 4Q20
- China PMI manufacturing
- RBA meeting and interest rate decision
- U.S. labour market report
Thought of the week
Australia’s near-term economic prospects continue to improve. Sentiment among consumers and businesses is on the rise, the unemployment rate is falling and fourth quarter inflation was stronger than expected. However, this won’t be enough to move the RBA when they meet this week. While the economy is getting back on its feet faster than forecast just a few months ago, the medium-term prospects haven’t changed and this is what the RBA is focused on. The unemployment rate is likely to remain some way from the RBA’s full employment target even as survey based measures improve (see chart). Meanwhile, inflation may get a lift in the coming quarters from the low base effects from 2020 but probably won’t be considered a sustainable move higher by the RBA. There is a lot of good in the outlook for the Australian economy but not yet enough to really unwind the dovish view of the central bank and their long held belief of an ‘unpredictable and uneven’ recovery in 2021.
Australian jobs outlook continues to improve
JPMorgan Global Research Enhanced Index Equity Fund
To achieve a long-term return in excess of the benchmark by investing primarily in a portfolio of companies, globally; the risk characteristics of the portfolio of securities held by the Sub-Fund will resemble the risk characteristics of the portfolio of securities held in the benchmark.