Ease it!

• As expected the RBA cut the cash rate by 25 basis points to 1.25%, a record low. Not because of concerns with our economic growth as much as the desire to move inflation.
• Today’s GDP figures disappointed so further cuts are likely.
• The ASX-200 index closed up again today 6358 and Aussie dollar closed at US$.70.
• In the US Federal Reserve Chairman Jerome Powell indicated the central bank is “closely monitoring” the impact of US trade tensions (China, Mexico and Europe) and suggests officials may ease policy if their economy is threatened.
• KPMG has reported more than half (58%) of Australia’s CEO’s were “Very Confident” about their companies’ prospects over the next 3 years, up from 22% last year.
• I attended a fabulous presentation by property analyst commentator, Gavin Hegney last week in aid of Telethon Speech and Hearing. Gavin outlined the positive signs for the West Australian property market and described our counter cyclical nature to the East Coast. The following graph is from his presentation. Sentiment in the room suggested we are at “Hope”. I’m closer to “Optimism”.
• Email me to let me know where you feel we are in the cycle. I will report the results in my next newsletter.