Domestic credit remained strong to start the year, particularly in subordinated financials. Street inventories remain low—supporting tighter spreads.

The ASX-listed debt and hybrid universe delivered a modest gain of 0.20% through November, underperforming the AusBond Credit Index.

Markets fared reasonably well across the board over October, despite a poor closing week.

September was a strong month for credit markets, with most major indices regaining the losses they suffered through August.

August was a relatively soft month for credit markets, as the rebound from March lows either slowed to marginal gains or retraced.

Markets fared positively through July with all major indices finishing the month higher, albeit moderately.

June was a broadly positive month for the markets, with all major indices posting gains, though these were more modest relative to recent months.

The improvements in markets seen in April continued through May, as all major market indices finished the month in the black.

Australian markets experienced a relatively strong rebound through April as investors were buoyed by the improving messaging surrounding the domestic COVID-19 health crisis.

After what felt like an awful end to February, relief to markets from large global stimulus was short-lived.

The domestic equity market suffered a horror end to the month of February, as concerns for the global impact of the coronavirus escalated.

Markets closed stronger in January, largely retracing losses seen late in 2019, with the ASX recovering from the 237bps decline in December.

December closed as a poor month for markets broadly, with the AusBond FRN the only major index to end the month in the black.

Global geopolitical uncertainties continue to dominate markets, with US trade concerns driving a turbulent November.

With now just three 25-basis point steps away from zero, there are growing expectations the RBA will cut further or even implement some form of quantitative easing.

The official cash rate has been lowered for the third time in a year, with the RBA cutting the official cash rate to a historical low of 0.75%.

Financial market participants currently expect one more cut by the end of 2019, with the Cash Rate Futures pricing in a 25 basis-point cut in October.

The RBA left the official cash rate unchanged at 1.00% at its August board meeting, saying it will monitor developments in the labour market closely.

The Australian hybrid market enjoyed another strong run in June, with the median trading margin of ASX-listed hybrids under Morningstar coverage closing at 2.56% at June’s end, down 54 basis points from May.

The Reserve Bank of Australia has cut the official cash rate to 1.25% after keeping rates on hold at 1.50% for almost three years.

The Reserve Bank of Australia defied a growing bearish overlay on interest rates by forecasters and maintained the cash rate at 1.5% at its May Board Meeting.

No major surprises as the RBA maintained the cash rate at 1.5% at its April Board Meeting. The RBA continues to play a waiting game, while economists maintained downbeat tones on the trajectory of rates.

A key development during February was the shift in the expected direction of short-term interest rates as the RBA changed their “next move is up” language with a “neutral” bias.

In line with equity markets, hybrid securities also posted a positive January led by the longer-dated bank notes.