Market & Portfolio Update - September 2023
Global share markets gave back some of their gains in September, declining 3.7% in local currency terms, but they remain up 12.1% year-to-date.
Energy companies benefitted from higher oil prices. The industry benchmark, Brent crude oil rose by 10% during the month to US$95 p/b, following the extension of production cuts by Saudi Arabia.
Key central banks around the world met in September, with most leaving their policy rates unchanged, whilst delivering commentary indicating we may see interest rates remain higher for longer, as well as leaving the door open for more hikes if required. Sticky inflation and strong US economic data, which point toward resilient economies and labour markets, are forcing central banks to be cautious.
The “higher for longer” messaging from central banks contributed to a reasonable increase in the yields on longer-dated bonds. Yields on the US 10- and 30-year bonds were up over 0.5% for the month and now sit at levels not seen since 2007.
Rising bond yields weighed on portfolio returns last month (as bond prices and yields are inversely related). However, there is a silver lining - higher yields mean reinvestment rates are now more attractive, supporting the future returns of bond investments.
You’re Missing Out on Tax Savings If You Haven’t Had a Chattels Valuation Done
We’ve been recommending chattels valuations from Valuit for over 20 years, and it still amazes us how many property investors haven’t had one completed.
If you own a rental property and your current accountant hasn’t discussed chattels valuations and depreciation with Valuit, there’s a very good chance you’re paying thousands of dollars more tax than you need to over the life of the property.
12 Common issues and mistakes we regularly see
We review many financial statements prepared by other accountants. Below are some recurring issues we frequently identify, many of which are also areas the IRD commonly focuses on.