Quarterly Update - Investor Newsletter Q1 FY20
Entrenched uncertainty is exerting a pervasive depressing effect on global economies. A growing number of global manufacturing & services indexes are now in contraction territory. There is also the concern of a deeper slowdown with the U.S. no longer immune to slowing global growth or the impact of trade tensions, with the U.S. Institute for Supply Management declining to a level previously seen a decade ago.
Closer to home, The Reserve Bank of Australia (RBA) cut interest rates to a new all-time low as the economy recorded its slowest growth since the global financial crisis. As broader economic activity slows the importance of earnings quality and balance sheet strength becomes a vital tenet in equity portfolios.