“Will interest rates fall in 2024?” With the Reserve Bank of Australia’s (RBA) Board meeting frequency amended to only be eight times each calendar year, this question is more pressing than ever. On 6 August, in their fifth monetary policy decision of the 2024 calendar year, the RBA left the cash rate on hold at 4.35%. While economic forecasters offered varying predictions on this decision in the lead up to the meeting, the RBA noted inflation remains above target and continues to prove persistent.
While NAB’s July Forward View for Australia saw some economists deferring their expectations for the first rate cut to May 2025, Westpac’s chief economist noted that the Bank of Canada has already started cutting rates, with the U.S. and New Zealand likely to follow suit in the near term.
In the second calendar quarter of 2024, the Australian economy experienced modest growth of 0.1% compared to the first quarter and 1.1% over the past year. Household consumption increased by 0.4% during this quarter, slightly surpassing growth rates from the December calendar quarter of 2023. Labour productivity remained unchanged for both the quarter and the year, as the increase in hours worked matched the growth in GDP.
ABS retail sales data indicate another quarterly decline in real retail sales, as noted in NAB’s July Forward View. Australia’s unemployment rate is projected to rise to around 4.5% by the end of CY2024 and remain stable through CY2025. With unemployment being a key focus this year, I look forward to seeing how these trends might influence future decisions by the RBA.
View the key macro-economic indicators as of 6 August 2024:
Key Economic Data
- Official Cash Rate: 35%
- Monthly CPI Indicator:8% p.a. (4% p.a. in month prior)
- Inflation Rate QoQ: 1% (1% in quarter prior)
Consumer Sentiment
- Housing Credit MoM: 4% (0.4% in month prior)
- Private Sector Credit MoM: 6% (0.4% in month prior)
- Retail Sales MoM: 5% (0.6% in month prior)
Housing and Construction
- Home Loans MoM: 5% (-1.9% in month prior)
- Investment Lending for Homes: 7% (-1.3% in month prior)
- Building Permits MoM Prel: -6.5% (5.7% in month prior)
- CoreLogic Dwelling Prices MoM: 5% (0.7% in month prior)
- Private House Approvals MoM Prel: -0.5% (1.9% in month prior)
Labour Market
- Unemployment Rate: 1% (4% in month prior)
- Participation Rate: 9% (66.8% in month prior)
Trilogy’s Industrial Property Trust portfolio catches a new wave of opportunity
July was an eventful month for the Trilogy Industrial Property Trust (Industrial Trust) and our Property Team. We began the month by welcoming Laurence Parisi as Trilogy’s new Manager – Property Funds. With over 22 years of senior experience within the property investment industry and a strong track record in wholesale and direct retail property funds, Laurence undoubtedly brings valuable expertise to the Industrial Trust.
We’re also very excited to announce that for the third consecutive year the Industrial Trust was named Finalist for Financial Newswire and SQM Research’s “Direct Property – Fund Manager of the Year 2024”. After winning the award in 2023, we wait with anticipation for the 2024 winners to be announced in September.
Finally, the Industrial Trust has secured another blue-chip acquisition opportunity, this time in the well-established Northern Geelong Industrial precinct. Located in North Geelong, this property spans 3.8ha and includes two warehouses/offices. It boasts high exposure to Corio Quay, rear frontage to the Melbourne/Geelong Railway line, and sits directly opposite the Geelong Port.
The property is tenanted by UG Manufacturing Co Pty Ltd, trading as renowned Australian brand, Quiksilver. A global leader in the sport, outdoor and lifestyle apparel industry, this opportunity will innately enhance the Trust’s portfolio.
- As at 31 July 2024. Please note, past performance is not a reliable indicator of future performance.
This article is issued by Trilogy Funds Management Limited ABN 59 080 383 679 AFSL 261425 (Trilogy Funds) as responsible entity for the management investment schemes mentioned in this article. Application for investment can only be made on the application form accompanying the relevant Product Disclosure Statement (PDS) and by considering the Target Market Determination (TMD) available at www.trilogyfunds.com.au. The PDS contain full details of the terms and conditions of investment and should be read in full, particularly the risk section prior to lodging any application or making a further investment, together with the TMD. All investments, including those with Trilogy Funds, involve risk which can lead to no or lower than expected returns, or a loss of part or all of your capital. Trilogy Funds is licensed to provide only general financial product advice about its products and therefore recommends you seek personal advice on the suitability of this investment to your objectives, financial situation and needs from a licensed financial adviser. Investments with Trilogy are not bank deposits and are not government guaranteed. Past performance is not a reliable indicator of future performance.
