Over the weekend of February 1-2, Australian time, US President Donald Trump fired the opening salvos in what might have become (and may yet become) a nasty trade war between supposed allies the US, Canada and Mexico.
The Bank Bill Swap Rate, commonly known as BBSW, is the most common measure of short-dated interest rates in Australia. Strictly speaking, it is the rate at which Australia’s prime banks borrow money for short periods, like three months or six months. BBSW is normally near, but just above, the RBA cash rate.
Trade opportunities
The current portfolio yields an indicative 5.41%* to the assumed maturity dates with an approximate $204k spend.
General
New issues update
Trade opportunities
We've updated our Sample Portfolios for the month.
The RBA will do something historically noteworthy this coming meeting, regardless of what they decide. Either they will deliver the first rate cut of the 2025 rate cutting cycle, or they will disappoint a market priced for cuts more severely than they ever have before. With the consumer side of the economy showing signs of strengthening following tax cuts and real wages rising, there are plenty of reasons to wait before delivering the rate cut, even if inflation has fallen materially. But the optics may not let the RBA wait. So does the RBA want a rate cut or a hard place?
The FIIG Monthly Income Fund returned 0.50% net of fees in January, outperforming the AusBond Bank Bill Benchmark by 0.11%. This brings total outperformance (net of fees) to 1.14% since the fund’s inception in October 2024.
General
New issues update
The Q4 CPI data has printed and it was generally better (that is lower) than anticipated. The RBA has some big decisions to make at their coming meeting. The headline inflation rate was +0.2% on the quarter and +2.4% on the year.
FIIG’s Investment Strategy Team conduct a yearly Portfolio Review in addition to the ongoing consideration and assessments carried out by the Relationship Manager across the year.