Australian Bond Investors Watching for Headwinds to Economic Growth
Dow Jones14:09
0609 GMT - It feels as though investors in the Australian government bond market are now prepared to look far enough ahead to focus on the strengthening of headwinds to economic growth, says Josh Rout, portfolio manager at Franklin Templeton. Those headwinds largely stem from the correction in the housing market having a negative wealth effect and causing the savings rate to rise, while curbing government revenue growth, he adds. The Reserve Bank of Australia will be very cautious about hiking rates further from here. The bigger question now is when will the market start to entertain the next move being an interest rate cut, Rout says.
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