Australian bond yields have risen over the past 18 months, highly influenced by movements in the US, reflecting more hawkish expectations for policy rates and a higher term premium. As is the case overseas, we think that markets are currently overstating where policy rates will ultimately settle and expect bond rates will come back from their current level in time.
It is anticipated that NOM will total a still elevated 410,000 in FY2024 given continued strength in temporary migration. Further out, it is forecast that NOM will taper back to 250,000 per annum by FY2027.
In October 2023, the CBAM entered its first transitional phase, requiring EU importers to start reporting on their emissions. The CBAM will come into full force in 2026, when importers will be required to purchase and surrender CBAM certificates.
The passing of the previously delayed Housing Australia Future Fund (HAFF) means that all the Albanese government’s announced housing policies are now in place. These policies represent a minimum funding pool of $5.5 billion stretching to the end of the decade, potentially lifting as high as $10 billion if all targets are met and excess fund returns achieved.
Negative momentum for total building in FY2023 (-8%) is expected to continue in FY2024, with activity sliding a further 11% to $108.4 billion (constant FY2021 prices). The uplift in build costs and a large backlog of work that is proving difficult to draw down are amplifying the demand drag of higher borrowing costs. Delays and builder administrations are further supressing home buyer confidence.
The pipeline of build-to-rent (BTR) developments across Australia continues to swell, with our project tracking currently capturing a pipeline of circa 45,000 announced units. Around 5,900 units have broken ground in FY2023, with a further 15,000 geared to commence across FY2024 and FY2025
Australian bond yields have risen over the past 18 months, highly influenced by movements in the US, reflecting more hawkish expectations for policy rates and a higher term premium.
The Wage Price Index (WPI) increased by a sharp 1.3% q/q in Q3 – the largest quarterly growth on record – taking the y/y pace of growth to 4.0%. The jump in wage growth was partly driven by the larger the usual 5.75% increase in award wages implemented in July.
As the world heats up, so does the urgency to assess our collective progress against the goal of limiting global temperature increases to 2℃ as set out in the Paris Agreement.
The Wage Price Index (WPI) increased by a sharp 1.3% q/q in Q3 – the largest quarterly growth on record – taking the y/y pace of growth to 4.0%. The jump in wage growth was partly driven by the larger the usual 5.75% increase in award wages implemented in July.
The office sector in Australia is facing several headwinds, including reduced demand from hybrid working arrangements, slowing economic and employment growth, and rising bond rates and yields. However, it may still present an attractive cyclical investment opportunity with astute timing and management of vacancy and incentive risks.
The National Transport Commission (NTC) and the Australasian Railway Association (ARA) commissioned Oxford Economics Australia to update and extend quantitative rail workforce capability modelling last completed in 2018 and published in the ARA’s report. Fundamentally, this report
seeks to explain how skills demand will form for the rail industry over the coming decade, what will be
the key threats to workforce capability, and what industry and governments can do to respond to meet the challenges of delivering on the significant rail infrastructure investment.
The fight against inflation is well underway across the globe, with most central banks either approaching or having already reached the peak of their hiking cycle. Additionally, geo-political
tensions and the possibility of increasing restrictions on trade between global rivals remains a key downside risk to the global outlook.
There remains action on the policy front that has the potential to swing the medium to long-term outlook. In the lead-up to the 2023/24 Budget, the Federal Government released its Migration System Final Report.
We have revised up our forecast for long-term bond yields in several advanced economies – most notably in the US where yields have been lifted by 50 basis points in our forecasts.
Airbnb contributed $13.6 billion to Australia’s GDP and supported nearly 95,000 jobs in 2022, with guest spending boosting local businesses and domestic tourism, according to a new Oxford Economics report.
Global passenger vehicle production was heavily impacted by the pandemic. Major manufacturers’ forecasts for demand were lowered substantially at the onset of the pandemic, while supply chain disruptions continued to force manufacturers to scale back production.
The passing of the previously delayed Housing Australia Future Fund (HAFF) means that all the Albanese government’s announced housing policies are now in place. These policies represent a minimum funding pool of $5.5 billion stretching to the end of the decade, potentially lifting as high as $10 billion if all targets are met and excess fund returns achieved.
The shift to flexible ways of working and using office space was already underway prior to the pandemic with the advent of open plan offices, activity-based working, hot desking and co-working space.
The major CBD Australian office markets are oversupplied, with double-digit vacancy rates that should be suppressing rental growth. However, historically high incentives are boosting the financial appeal for tenants to move into better quality space when their leases expire, even as stated rents rise in many locations.
