The banks beat their chest
The ASX200 cracks 7100 (but slips back under) closing up 0.8% for the week, BHP $50 again, Iron ore US$200, and the DOW a new record. The tech’s here are taking it in the neck a bit but good movement by our REITs and banks.
The RBA holds fire on interest rates but increases their GDP growth numbers. RBA governor Philip Lowe said they were “unlikely” to increase the 0.1 per cent cash rate until 2024; this is a slight change in wording (such is the subtlety of language used by the Central banks) and opens the door for potential to increase beforehand.
“The economic recovery in Australia has been stronger than expected and is forecast to continue. This recovery is especially evident in the strong growth in employment”
The RBA has also upgraded expectations for economic growth to 4.75% for 2021, a stark jump on their expectations from February of 3.5%.
According to CoreLogic, dwelling prices have boomed by another 1.7% in Apr-21, after a 2.6% rise in Mar-21 which was the strongest since 1988. The increase for the year so far is 7.8%. Sydney posted the strongest gain of 2.1% for April. Regional areas are also still booming up 1.7% in April or 13% year on year.
In other interesting economic news, the number of JobSeeker (unemployment benefit) recipients since the expiry of JobKeeper in March has actually dropped by 93,000 in the 4 weeks of April. This contrasts Treasury estimates for job losses of over 100,000. There were also approx. 650,000 fewer people on JobKeeper in the March quarter than previously estimated.
It confirms the smoother transition out of Jobkeeper we reported on some weeks back.