Investor Update: Q1 2022

Overview

In the first quarter of 2022, Australia faced a myriad of uncertainties with the onset of military conflict in Eastern Europe, the floods affecting South-East Queensland and New South Wales, a looming federal election, as well as the residual effects of the COVID-19 pandemic.

Inflationary pressures in the economy are projected to continue, especially given the volatile international outlook and the likelihood of energy prices remaining high in the coming months.

In early April 2022, the RBA acknowledged that expectations of raising interest rates had materially increased. Most analysts are now forecasting significant interest rate rises commencing from mid-2022. Westpac revised its forecast for the cash rate to reach 1.25% by the end of 2022.

Despite this, Australia’s commercial property market has remained largely resilient to date. Passing yields will potentially increase later in the calendar year which could reflect significant buying opportunities.