Market & Portfolio Update - March 2022
Global share markets gained 3% following strong economic data releases, investors understanding the economic implications of the Russian invasion better, and more clarity around the Federal Reserve’s hiking path over the remainder of 2022. The New Zealand share market gained as well, however, the Australian market was the strongest performer returning over 6% for the month. The Australian market has a higher allocation to commodity producers such as iron ore miners and natural gas, which have performed well as global commodity prices have risen since the war began.
The impacts of the war continue to keep commodity prices elevated, and inflation is rising globally. Here in New Zealand, the Reserve Bank’s job is to maintain price stability and inflation at 2% over the long term. With inflation running considerably higher than that at the moment, we are seeing an increased chance of the RBNZ raising interest rates by 0.5% at their next meeting.
Meanwhile, the US Federal Reserve raised its policy rate by 0.25%, with eight further hikes (2.2% in total) expected by the markets for the remainder of 2022. The Fed also discussed plans to reduce its $9 Trillion balance sheet over the coming months.
Market & Portfolio Update - April 2022
Global share markets continued their choppy start to 2022 during April.For New Zealand based investors, a fall in the NZ dollar played an important role in helping offset the volatility global share markets experienced. The NZ dollar fell against most major currencies supporting the returns of unhedged overseas assets (assets that are free to move with exchange rates). As a result, ‘unhedged’ overseas investments fell by only 1.8% for NZ based investors.
The KiwiSaver Gender Divide – Why are women saving less and what can be done to combat this?
Recent data shows that, on average, women have 20% less in their KiwiSavers than men. The gap being at its largest between men and women in their 40s and 50s. There are a few factors that come into play causing this divide and although it will take years to achieve equality, there are ways in which we can be proactive to help close the gap. As of August 2021, the gender pay gap is at 9.1% in New Zealand, a decrease of about 0.4% from 2020’s stats.