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The Trifecta

Written by Angela Bernardi . March 02, 2020
1 min read

Australia has had the trifecta... bushfires that have devastated a large part of NSW and VIC. The Corona Virus now known as COVID19 which has impacted our economy in many ways, especially via our tourism and education sectors. Followed by torrential rain and storms, which to some has provided much needed relief from the drought but unfortunately again caused devastation with floods.

All of these factors are out of our control, so how are we reacting?

Market Uncertainty

There is a lot of uncertainty in our market. How do we know this? The gold market thrives on uncertainty. Precious metal has soared to a seven year high and long positions in gold futures and options has jumped.

Economic Perception

Interest rates were expected to drop by a full 25 basis points this year, and given the recent drops and the trifecta of uncontrollable conditions, economists are suggesting that consumers and businesses now believe the economy and its prospects are worse than they actually are.

The Reserve Bank Governor Philip Lowe said that despite the disasters, the economy was going through “a gentle turning point for the better”, predicting modest increases in growth and consumer spending over the coming two years.

Let’s cross our fingers and hope 2020 starts to see a smoother ride.

 

*This information is relevant at the time of publishing and is subject to change*
Written by Angela Bernardi . March 02, 2020

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