Dinner in Restaurant

Sept 2021 Economic Update

Will Douglas, a Private Client Adviser at Morgans, shares the latest updates.

Strategic thoughts to absorb from this update:

  • Note Sept seasonal weakness and increasing US Corporate tax rates increase volatility

  • Global growth rates are strong, and this should continue as reopening continues

  • We are entering a Global trade boom (good for commodities)

  • US markets are expensive – we have a preference for Asia, Australia, and Europe

  • We model a stronger Australian currency, so we stay with hedged US & EU investments

  • The 2nd leg of the commodities boom is still to come

  • We favour Travel as the reopening trade

  • Australia may benefit from a property boom, commodities boom, and the resultant wealth effect all at the same time (excellent economic times to come – supports share investments)

  • We prefer to share exposure currently and see actual negative returns and capital risk for Bonds.

  • We prefer ‘Floating Rate’ fixed interest exposure.

  • Take Profits from Covid ‘winners’ and recycle capital into reopening trades.

  • Property - Take Profits from Covid ‘winners’ and recycle capital into reopening trades

  • Banknote margins, term deposit rates are all likely to head lower (Banks don’t need the capital)

  • We welcome John, Nick, and Laura – our ‘new’ team members.

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