Since the GFC, the economy has enjoyed what many have dubbed the Australian moment. It was argued that Australia was structurally well-positioned in terms of China and a falling USD which helped push-up commodity prices and investment. According to UBS, the Australian economy has a sell sign hanging as US and Japanese investors redirect their portfolios to their home markets. Foreign investors are deserting the market for Australian government bonds, buying only 30% of issues compared to 80-90% a year ago. In the medium-term, Australian bonds/equities are expected to underperform as balance is restored to our economy. (VIEW LINK)
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