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The financial topic discussed this fortnight was value investing. The latest edition also contained the following Market Update:
Since our previous edition, Australian and global sharemarkets have experienced strong upward movement. The S&P ASX200 Index has risen 9.60% from the 21st of March to the 4th of April. It is now down 7.83% from the same time last year and down 11.36% for the calendar year (2008) so far. The MSCI World - ex Australia, a measure of the global market, has risen 5.52% over the same period. The index is down 9.09% from the same time last year and down 8.69% for the calendar year so far.
Emerging markets have also experienced positive movement with the MSCI Emerging Markets Index rising 7.41% since the 21st of March. It is up 14.92% from the same time last year but down 8.85% for the calendar year so far.
Property trusts have continued to experience positive movements since the 21st of March with the S&P ASX 200 A-Reit Index (formerly known as the Property Trust Index) rising by 8.19%. However, the index is down 28.41% from the same time last year and also down 17.39% for the calendar year so far.. The S&P/Citigroup Global Real Estate Investment Trust (REIT) Index, a measure of the global property market, has risen 5.70% over the same period. It is down 19.83% from the same time last year and now only down 0.08% for the calendar year so far.
As of 4pm the 4th of April, the value of the Australian dollar had fallen slightly since the 21st of March with the Aussie dollar down 0.40% against the US Dollar at .9117. It is up 12.28% from the same time last year and up 3.41% for the calendar year so far. Since March 21st the Aussie has fallen 0.15% against the Trade Weighted Index now at 68.8. This puts it up by 3.77% since the same time last year and up only 0.15% for the calendar year so far. (The Trade Weighted Index measures The Australian dollar against a basket of foreign currencies.)
Since our last edition the board of the Reserve Bank of Australia have decided to keep official interest rates at 7.25%. In a brief statement the Governor of the RBA, Glenn Stevens, informed that the decision was made because the tightening of financial conditions, including RBA monetary policy, had been substantial since the middle of 2007. This tightening is working to foster a moderation in demand growth that will take pressure off inflation. He suggests inflation should decline over time, provided demand slows as expected and as a consequence the current level of the RBA policy interest rate was appropriate.