What is bond duration and why do investors need to understand it?
Understanding bond duration and its impact on portfolio risk Duration is a key concept investors need to understand when investing in corporate bonds and building a portfolio. Quite simply, duration measures the sensitivity of a bond to a change in interest rates. It is measured in years and will vary according to the bond’s maturity […]
ABE Weekly – Interest rates rising, but peak still a far climb
Australian Bond Exchange Weekly Update Friday 23rd June 2023 Key Points Bank of England hikes the cash rate half a percentage point to 5%, to fight sticky 8.7% inflation recorded in the year to April and in the year to May. RBA releases the minutes from the June monetary policy meeting, with upside risks to […]
The impact of interest rates on corporate bonds: what financial advisers need to know
How interest rates exert a key influence over bond prices and their yields Once a corporate bond is issued, it can be traded on financial markets. Just like equities, bonds will see their prices fluctuate – although bond prices tend to be far more stable than those of equities. A number of factors affect the […]
ABE Weekly – Wall Street veteran latest to jump on the bondwagon
Australian Bond Exchange Weekly Update Friday 16th June 2023 Key Points Unemployment drops to 3.6%, despite the RBA’s attempt to soften the market by increasing the cash rate 400bps since last year. Another hike is now predicted for July. Consumer sentiment at “recession lows” as Australians struggle with a cost-of-living crisis, further complicated by a […]
ABE Weekly: When it comes to debt, it pays to be the creditor
Australian Bond Exchange Weekly Update Friday 9th June 2023 Key Points The RBA hiked the cash rate again on Tuesday, raising it 25 basis points to 4.1%, signaling to markets they will do whatever is necessary to curb this sticky inflation Investors and commentators are jumping on the “bondwagon” as a new sense of hype […]
ABE Weekly: Macquarie Backs Bonds as Equities Lose Appeal
Australian Bond Exchange Weekly Update Friday 6th June 2023 Key Points New Australian CPI data shows inflation is still pernicious, driven by rising rents and lack of housing, prompting some analysts to predict another cash rate hike as early as next week. SIAA Conference insights suggest investors are moving away from highly volatile investments like […]
CBDC vs Cryptocurrency, what’s the difference?
If you’ve been reading the financial news headlines over the past six months, it’s likely you’ve encountered the acronym CBDC. When it comes to dissecting the official explanations of financial concepts and their accompanying acronyms, it can take time to wade through the reams of academic information, intertwined with complex concepts and industry jargon, delivered […]
ABE Weekly: $1 trillion predicted to flow into fixed income, as market shifts
Australian Bond Exchange Weekly Update Friday 26th May Key Points Westpac’s Leading Index of Economic Activity forecasts slow economic growth (1%) in 2023, reporting a 20% drop in housing approvals in the first quarter of the year Sticky inflation across major economies, including the higher than forecasted figure of 8.7% inflation for the UK, is […]
Real-time CBDC bond settlements closer than you think
Australian Bond Exchange Holdings Limited (ASX:ABE) (“Australian Bond Exchange” or “the company”) are excited to announce the successful test of the first near real-time Central bank Digital Currency (CBDC) bond settlement in Australia. Key Points First near real-time CBDC bond settlements executed using Australian Bond Exchange’s technology Australian Bond Exchange one of 15 use cases […]
ABE Weekly: Wage Growth Outpacing RBA’s Cash Rate
Australian Bond Exchange Weekly Update Friday 19th May Key Points RBA minutes released this week explain the 25bps rate rise that shocked the markets. Wages increasing at a rate higher than the RBA cash rate, signaling stickier inflation. Low unemployment and increasing wages could be favourable for bond investors. The US debt-ceiling is self-imposed and […]