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September 6, 2022

Banks in a Bind

ANOTHER CENTRAL BANK phrase keeping markets on its toes: the neutral rate. The neutral rate is an estimate of what central bankers and economists think is the real interest rate (nominal interest rates minus inflation) that will manage inflation while supporting full employment or maximum output.

While central bankers grapple with how fast and high to take rates, in the real world inflation remains above target rates, interest rates continue to rise and property prices are under pressure.  

This environment is problematic for Australian banks, and a fall in the property market will adversely impact our big four lenders.   So what does this mean for investors?   

Find out in this article by Russel Chesler (Head of Investments & Capital Markets at VanEck) for Informed Investor (no subscription required).

This information is general advice only and does not take into account your personal circumstances, goals and objectives. Therefore, you should consider its appropriateness for your circumstances before acting on this information.  

For strategic advice tailored to your personal situation, please reach out: info@genesisfp.com.au.

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