Bonds/Interest Rates

The Dow put on 180 points last night as Bernanke said nothing in Europe, the US dollar weakened, gold surged, and oil hit an all time high.

A monthly survey by National Australia Bank has found that business conditions throughout Australia remain at record high levels, increasing the chances for another RBA rate hike this year.

Wall Street was unsure just what clues were provided by various Fed statements last night, while a Japanese recession looks more clear.

The market was expecting payrolls to rise by 110,000 in August. The real number came as a big shock.

A big surge in the gold price saw Comex futures close over the magic US$700/oz level while Middle East tensions and low inventories sent oil ever higher. The Dow closed modestly higher.

Oz job growth numbers exceeded expectations in August.

According to TD Securities the Australian economy has a good track record of solid performance in times of global market volatility, a trend expected to continue through the current credit crisis.

The Dow was down 143 points last night in choppy trade. It seemed all news was bad news.

The world’s second largest economy is on the brink of recession, and a strong yen is only going to exacerbate the problems. In the meantime, global commercial paper markets remain frozen.

Australia’s cash rate remains at 6.5%.