Commenting on the Reserve Bank’s recent interest rate rise to 4.10% “to try curb inflation”, Brett Reynolds, Chief Investment Officer at Tiger Brokers Australia, says “it is highly likely that we’ll see at least one more rate rise this year,” adding that “employment and the participation rate remain historically high while inflation is not showing any signs of falling significantly. The incoming monetary policy board will see there is still a need to increase interest rates”.
“Food inflation is hurting many Australians, with it running at around 8 per cent. This is an incredibly high figure that everyone can see every time they go to the supermarket,” Reynolds says.
“The rising interest rates will put further pressure on landlords, so this is likely to put pressure to lift rents even further. First home buyers will also continue to be impacted, their borrowing capacity will be further reduced. The housing market is yet to show any signs of cooling from these interest rate changes, making it tough for those looking to move into home ownership.
“The local Australian sharemarket is currently seeing low trading volumes, with reduced market activity causing this. Some of the best trading opportunities are currently overseas, particularly the US markets where tech stocks are performing strongly. Nvidia is soaring, Microsoft remains popular, while Google continues to attract plenty of interest. To protect and grow your wealth, now is a great time to look beyond the Australian market to invest.”