March 2017 Overview


Key drivers of performance during the month included:

  • Economic data releases in most major regions surprisingly on the up.
  • Political uncertainty remained elevated over the reform agenda in the US and upcoming European elections.
  • An expected interest rate increase in the US by the Central Bank was accompanied by a statement that reaffirmed their gradual approach.
  • Concerns over Australian house prices and potential policy responses.

This environment proved favourable for portfolios with larger exposures to risk assets, including listed both Australian and global listed equities.


Key factors impacting financial market performance during the month were:

Equity Markets

  • Global equity markets posted modest returns and Australian equities performed strongly.
  • Economic data was broadly encouraging, maintaining its recent positive momentum, however this was partially offset by heightened political uncertainty.
  • Economic conditions remained broadly encouraging.
  • The US labour market remained strong and consumer confidence improved further. In Europe business conditions improved, while Japanese economic growth numbers were revised upwards. Domestically, economic growth accelerated in the December quarter, while the unemployment rate unexpectedly rose. Against this backdrop, banking regulators stepped up their rhetoric on the housing market, releasing new policies aimed at slowing the riskier forms of home lending.
  • Heightened political uncertainty weighed on global equity markets. Investor enthusiasm towards Donald Trump waned as his proposed health care changes failed to pass congrress and, in doing so, cast doubt over his ability to implement other parts of his reform agenda.
  • In Europe, attention remained focussed on the upcoming presentatial election in France while, in the United Kingdom, Prime Minister Theresa May triggered the articles necessary for the UK to leave the European Union.


Debt Markets 

  • Global government bond markets were largely unchanged over the month while Australian debt markets performed well.
  • Global interest rates pushed higher earlier in the month, but reversed their course after the US Federal Reserve increased interest rates.
  • Australian government bond yields fell off the back of falls in investor expectations of future inflation.
  • Non-government debt markets (corporate and emerging market bonds) were mixed.



  • Currency markets were largely unchanged.
  • The US dollar was softer following the release of the statement accompanying the US Federal Reserve's interest rate increase.
  • The Euro and British Pound were flat amid political uncertainty.