Market & Portfolio Update - June 2023
Global share markets had another strong month in June, rising 3.7% in New Zealand dollar terms. Investors were encouraged by a sharp drop in year-on-year inflation in the US of 4.0% - still above target but substantially lower than the 9.1% recorded in June 2022.
International bond markets were flat over the month as central banks transitioned from hiking their respective policy rates to pausing to evaluate incoming data. This is a signal that interest rates globally may be nearing their peak. The US Federal Reserve maintained their policy rate at 5.25%, the first pause after 10 consecutive hikes over the past 15 months. This should be supportive of bond returns looking forward.
The first half of the year has started off strongly for financial markets, regaining the lost ground they experienced in 2022. Global share markets have led the way, up 19% in New Zealand dollar terms. This highlights the importance of staying invested during volatile times and not focusing on news headlines which tend to focus on negatives.
Is your emotional attachment to money holding you back?
The way you attach value to money is a far more complex process than you might realise. Our brains are clever little engines, attributing different emotional values to the same amount of money, depending on how important it is to us.
I Googled My Financial Future. Here's What Happened
Spoiler alert: According to the internet, I should already be retired, living off dividends, and renting out three Airbnbs in Queenstown.
Sounds ideal. If only it were true.