• After a rally in July, both global shares and bonds turned lower and registered negative returns for Q3
  • Any hope of interest rate cuts was dashed as central banks reaffirmed their commitment to fighting inflation
  • The US Federal Reserve (Fed), European Central Bank (ECB) and Bank of England (BoE) all raised rates over the quarter
  • The US Fed raised the federal funds rate by 75 basis points (bps) to 3.25% in September, the third consecutive 75bps increase
  • The ECB raised interest rates in July and September, taking the deposit rate to 0.75% and refinancing rate to 1.25%
  • Annual inflation for eurozone was estimated 10.0% in September, up from 9.1% in August
  • Liz Truss was elected as new Conservative Party leader and hence as UK prime minister
  • UK pound hit a record low against the US dollar, close to parity as investors concern grew over the fiscal policy announcements
  • Emerging markets underperformed their developed counterparts as broad macroeconomic volatility and currency weakness took a toll
  • Poland, Hungary, and the Czech Republic equity markets were big decliners as the Russian war in Ukraine escalated
  • Continued macroeconomic headwinds meant US markets ended Q3 down with concerns about growth expectations and refreshed recession fears
  • The Australian sharemarket managed to gain 0.4% in Q3 better than the -4.9% decline in the S&P 500 and the -8.0% drop in emerging markets
  • Fixed income markets continued to suffer, especially the UK with the arrival of a new government with new policy
  • Australian household wealth fell 3.3% in the June quarter after 8 quarters of strong growth as shares, bonds and property prices declined
  • Commodities declined, driven lower by weaker prices for energy, industrial and precious metals
September 2022 Download Report