Ho Ho Ho – it’s a Santa rally…

4 months ago•By Jody Fewster

Fears that attacks in the Red Sea shipping route will disrupt supply have pushed up Oil prices (+4% on Monday).
Sending ships around South Africa’s Cape of Good Hope adds 20% to travel times and the additional cost burden. The flow-on effects may impact future inflation.
The US left their cash rate on hold last week with Jerome Powell indicating “cutting rates had now come into view”.
While many forecasters predicted a recession in the US in 2023, there has been a surge in manufacturing investment, a resilient labour market and falling inflation. US equity markets have had a great year with the NASDAQ up +45% year to date and the S&P 500 up +24%.
M&A activity in our resource sector plus the oil price rally pushed our market higher this week with the S&P/ASX 200 closing at a near 10-month high yesterday at 7,489. The index is up +6.4% year to date.
The All Ords Gold is up + 23% year to date. The Aussie dollar is $US 67.2.
WA’s economy grew 3.5% in the last financial year, the strongest in the nation. The mid-year budget review out yesterday saw Iron Ore royalties add $3 billion to our State coffers (Iron Ore prices have averaged $US 117 since July 1 against budget of $US 74).
Ray White’s chief economist, Nerida Conisbee, reports Perth house prices have risen 20% over the last two years, while construction costs have risen 40%.
Perth’s median home value of $646,520 is almost half the Sydney median of $1,125,000.
I would like to wish everyone a very Merry Christmas and I look forward to helping you with your real estate dreams in the new year.

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