February Market Update 2022

The Pulse

  •  Australia’s S&P/ASX 200 Index declined by -6.4% with significant sell-offs experienced in Information Technology (-18.4%), Health Care (-12.1%) and Consumer Staples (-9.6%).
  • Nonfarm payrolls rose 467,000 in January, well above of expectations of a 150,000 increase.
  • Eurozone annual inflation rose to 5.3% amid continuing high energy prices.
  • The RBA kept the cash rate on hold at 0.1% and will cease its $4-billion-a-week bond-buying stimulus program in early February.

Global economies
Global Covid-19 cases continue to rise with numbers surpassing 380 million cases and ten billion vaccine doses administered as at the end of January.

US
The Federal Reserve kept its policy rate unchanged at 0.00-0.25% at its January meeting and announced that with inflation well above 2% and a strong labour market, it expects it will soon be appropriate to raise the target range for the federal funds rate.

Europe
The European Central Bank made no change to interest rates at its January meeting, holding them at 0.0%, and pledged to reduce its bond purchases this year despite the record rise in inflation.

China
GDP rose 1.6% in Q4 2021, above the expected 1.1% rise, with the yearly rate also coming in ahead of expectations at 4.0%.

Asia Region
The Bank of Japan left interest rates unchanged at -0.10% during its January meeting.

Australia
The RBA left the cash rate unchanged at 0.1%, as widely expected, and decided to stop the A$275 billion bond-buying program with the final purchases to take place on February 10.

DISCLAIMER
The information in this Market Update is current as at 14/2/2022 and is prepared by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL 421445 on behalf of IOOF Holdings Ltd and its subsidiaries. Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Before making any decisions based on the content of this document, the reader must consider whether it is personally appropriate in light of his or her financial circumstances or should seek independent financial advice on its appropriateness. Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain and read the corresponding Product Disclosure Statement (PDS) and consider the contents of the PDS before making a decision about whether to acquire the product.

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