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A Global Economic and Market Outlook

A Global Economic and Market Outlook. Presented by Dr Chris Caton. March 2009. Financial Market Forecasts. The Australian Dollar and US Trade Weighted Index. Index. AUD/USD. AUD/USD (RHS). US TWI inverted (LHS). Source: Datastream. Exchange-rate volatility has been very high.

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A Global Economic and Market Outlook

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  1. A Global Economic and Market Outlook Presented by Dr Chris Caton March 2009

  2. Financial Market Forecasts

  3. The Australian Dollar and US Trade Weighted Index Index AUD/USD AUD/USD (RHS) US TWI inverted (LHS) Source: Datastream

  4. Exchange-rate volatility has been very high

  5. Australian Sharemarket Performance – ASX200 Source: Bloomberg

  6. Australian Sharemarket Performance – ASX200 (log scale) Source: Bloomberg

  7. Australian p/e ratios

  8. Largest falls in Australian equities

  9. US Housing starts and Permits (Millions) Source: Datastream

  10. Total US Non-farm Employment 3mth / 3mth chg Source: Datastream

  11. 2009 Growth Forecasts (%) Month of Forecast Source: Consensus Economics

  12. Trading partners growing significantly below trend

  13. Real GDP growth in Australia and the US Year to % change Source: Datastream

  14. The Labour market 000’s % Employment (LHS) Unemployment Rate (RHS) Source: ABS

  15. Australian Inflation % BT Forecasts GST Effect Source: ABS

  16. Petrol Prices relative to CPI Source: ABS

  17. Household debt and interest

  18. Hang on…help is on the way

  19. House Prices - Australia v Brisbane Index (1987 = 100) Source: ABS

  20. Commodity prices are finally falling Real metal prices Sources: IMF International Financial Statistics; US Bureau of Labor Statistics; Economics@ANZ.

  21. Gross Domestic Product % BTForecasts GST Effect Source: ABS

  22. Global Medium-Term Economic Growth and Inflation Prospects (2008-2021) Source: Consensus Economics

  23. Asia-Pacific Medium-Term Economic Growth and Inflation Prospects (2008-2018) Source: Consensus Economics

  24. Morgan Stanley Capital Indexes Developed Index Asian Emerging Markets Index Asian Emerging Markets Index (RHS) World Developed Index (LHS) Source: Datastream

  25. Summary • 2009 will be a very poor year for the world economy. A deep recession in the US is (more than) fully priced in. The risk is that it drags on. • The Australian economy has slowed, and is almost certainly already in recession. No matter what, it will be a tough year for many. • Interest rates will continue to fall. • The exchange rate is below fair value and likely to rise. • Stocks are cheap right now.

  26. This presentation has been prepared by BT Financial Group Limited (ABN 63 002 916 458) ‘BT’ and is for general information only.  Every effort has been made to ensure that it is accurate, however it is not intended to be a complete description of the matters described.  The presentation has been prepared without taking into account any personal objectives, financial situation or needs.  It does not contain and is not to be taken as containing any securities advice or securities recommendation.  Furthermore, it is not intended that it be relied on by recipients for the purpose of making investment decisions and is not a replacement of the requirement for individual research or professional tax advice.  BT does not give any warranty as to the accuracy, reliability or completeness of information which is contained in this presentation.  Except insofar as liability under any statute cannot be excluded, BT and its directors, employees and consultants do not accept any liability for any error or omission in this presentation or for any resulting loss or damage suffered by the recipient or any other person.  Unless otherwise noted, BT is the source of all charts; and all performance figures are calculated using exit to exit prices and assume reinvestment of income, take into account all fees and charges but exclude the entry fee.  It is important to note that past performance is not a reliable indicator of future performance. This document was accompanied by an oral presentation, and is not a complete record of the discussion held. No part of this presentation should be used elsewhere without prior consent from the author. For more information, please call BT Customer Relations on 132 135 8:00am to 6:30pm (Sydney time)

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