Market & Portfolio Update - August 2023
Global share markets gave back some of their gains in August, declining 1.8% in local currency terms, but with the NZ dollar weakening against most major currencies, returns were positive for NZ-based investors.
During the month, investors assessed weaker economic data coming out of China. China’s latest industrial production, retail sales, and fixed asset investment reports all came in below expectations, prompting a surprise rate cut from the People’s Bank of China. Policymakers have been attempting to spur growth and spending in the world’s second-largest economy throughout the year.
The developments in China contributed to the weakening New Zealand dollar over recent months. As noted above, a weakening New Zealand dollar supports the value of overseas investments for New Zealand-based investors. It also helps support the New Zealand economy. When the New Zealand dollar falls, it makes the prices of our exports more competitive on the global stage.
The Reserve Bank of New Zealand (RBNZ) left New Zealand’s Official Cash Rate (OCR) unchanged at 5.5% at its meeting in August. The RBNZ’s economic growth and inflation forecasts were little changed, and it continues to expect OCR cuts in the second half of 2024.
Market & Portfolio Update: July 2026
Early in the month, renewed tension in the Middle East briefly pushed Brent crude oil above US$100 a barrel, which lifted energy prices and brought inflation concerns back into focus.
Lifetime Book Club: Paradox of Choice by Barry Schwartz
In The Paradox of Choice, psychologist Barry Schwartz explores a curious feature of modern life: while freedom and choice are undoubtedly valuable, there can come a point where having more options makes decisions harder, increases our expectations and leaves us questioning whether we made the right choice at all.
From what to buy and where to eat to decisions about careers, relationships and money, Schwartz looks at the hidden mental cost of constantly comparing our options – and makes the case that sometimes, simplifying our choices can leave us better off.