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CONTRIBUTORS

Reece Birtles

Chief Investment Officer, Martin Currie Australia

This reporting season we are seeing revisions, guidance and price reaction being highly correlated to consumer and business confidence expectations, and far less correlated to the usual factors and information available during reporting season.

Given the linkages between consumer sentiment and economic sensitivities like rates and inflation, we have used our fundamental analysis of company, and engagement with management teams to better understand the future pathway for Australia’s GDP growth.

We went into the season looking to understand which economic scenario is most likely for 2024. Are we:

  • Facing a hard landing with prospects of weaker real growth, inflation at/below RBA targets, and significant rate cuts?
  • Looking at no landing, with real growth stronger for longer, rebounding inflation, and stubbornly high short-term rates?
  • Or, as it has felt more like since Christmas, a ‘Goldilocks’ soft-landing situation, with resilient real growth, future inflation at target, and modest cash rate cuts from middle of year?

Read the full report: HERE
 

Watch Martin Currie's recent Reporting Season webinar

Martin Currie Australia's Chief Investment Officer, Reece Birtles, helps investors digest company pricing power, cost inflation, consumer resilience, and commodity demand trends.

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