Overseas interest rate hikes could hit Aussie investment market


Forecast interest rate increases in the US and UK allied to a weakening Australian dollar could see a "rush of capital out of Australia", Australian Unity Investments chief executive, David Bryant believes.
Bryant said foreign investors had been "chasing Australian interest rates," which have remained high by global standards in recent years, but the combination of higher interest rates overseas and weakening value of the Australian dollar was likely to prompt investors to look elsewhere.
"The Australian dollar has already dropped to a four-year low and more downside is likely. I wouldn't be surprised to see it go below 80 US cents in the near future," he said.
"Added to the fact that both the US and UK have interest rate increases on the horizon, the probability is that capital will be looking for other homes.
"Once the interest rate differential shrinks — which will happen sooner rather than later — that foreign capital will flow out in in rush."
Recommended for you
Fund managers may be operating in a squeezed environment, but a salary guide shows they are willing to pay up for specialist talent to diversify their fund range.
Reach Alternative Investments has entered into a strategic partnership with Russell Investments to bolster its wholesale private markets offering for financial advisers and investors.
Boutique investment consulting and research house Genium Investment Partners has announced a senior appointment to drive further growth in its research ratings business.
Nuveen has appointed a global head of estate, a successor to Chris McGibbon who steps down after almost 25 years.