Economic Update September 2023
Waiting for the turn
The global economy still proves resilient to cost of living pressures and higher interest rates as unexpectedly tight labour markets support activity. Central banks may need to hold rates higher for longer to bring inflation down, leaving investors overweight fixed income waiting for longer duration positions to prove their worth.
In Australia, the Reserve Bank of Australia (RBA) continues to search for the ‘narrow path’ to a soft landing, pausing its hiking cycle in recent months to preserve gains in the labour market as inflation starts to retreat and Australian economic activity, on the whole, has started to slow.