Pete Wargent blogspot

Co-founder & CEO of AllenWargent property advisory & buyer's agents, offices in Brisbane (Riverside) & Sydney (Martin Place) - clients include hedge funds, resi funds, & private investors.

4 x finance/investment author - 'Get a Financial Grip: a simple plan for financial freedom’ (2012) rated Top 10 finance books by Money Magazine & Dymocks.

"Unfortunately so much commentary is self-serving or sensationalist. Pete Wargent shines through with his clear, sober & dispassionate analysis of the housing market, which is so valuable. Pete drills into the facts & unlocks the details that others gloss over in their rush to get a headline. On housing Pete is a must read, must follow - he is one of the better property analysts in Australia" - Stephen Koukoulas, MD of Market Economics, former Senior Economics Adviser to Prime Minister Gillard.

"Pete Wargent is one of Australia's brightest financial minds - a must-follow for articulate, accurate & in-depth analysis." - David Scutt, Business Insider, leading Australian market analyst.

"I've been investing for over 40 years & read nearly every investment book ever written yet I still learned new concepts in his books. Pete Wargent is one of Australia's finest young financial commentators." - Michael Yardney, Australia's leading property expert, Amazon #1 best-selling author.

"The most knowledgeable person on Aussie real estate markets - Pete's work is great, loads of good data and charts, the most comprehensive analyst I follow in Australia. If you follow Australia, follow Pete Wargent" - Jonathan Tepper, Variant Perception, Global Macroeconomic Research, and author of the New York Times bestsellers 'End Game' and 'Code Red'.

"Pete's daily analysis is unputdownable" - Dr. Chris Caton, Chief Economist, BT Financial.

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Tuesday, 22 January 2013

What to look out for in this quarter's inflation figures

There are a few things to bear in mind. There is usually some seasonal "drag" in fourth quarter (-0.2%) which tends to make inflation or CPI prints lower, and  there will still be a small residual impact from the introduction of the carbon tax (perhaps +0.1%).

The key takeaway point is that it is likely to take a very low core print to see the Reserve Bank looking to cut interest rates again as soon as February.

Economists forecast a fairly wide range of prints from 0.2% to 0.7%.

If you look through the risk areas identified in recent board minutes, there is not too much new so far that would suggest another cut so soon.

US house prices and consumer confidence appear to be rising again, and Chinese growth appears to have stabilised.

In particular the iron ore spot price has continued its resurgence by some 70% from its nadir.

Meanwhile Aussie stocks are cruising to new highs.

And while short-term property price data is inherently uncertain and volatile, it looks as though prices may be ticking up a touch, to the extent that month-to-month data tells us anything.

The Reserve Bank won't be unduly concerned at this stage to the extent that minor price gains only reverse previous declines, but it certainly wouldn't be happy with double digit growth.

Of course there are other concerns, in particular investment outside the mining sector.

But overall, most signs point towards a "wait and see" approach to interest rates in February.


In other interesting news, Michael Matusik explains here why the resources boom is far from over - just look at the level of committed resources projects!

And MacroBusiness reports here that it is already scrapping its underperforming Macro Investor service. 

I guess we never will find out what happened to their recommended shorting of Fortescue Metals while the iron ore price boomed by 70%. Hopefully not too many got burned by that.