The RBA kept the overnight cash rate steady at 2.75% during the July sitting and elected to lower the cash rate by 25 basis points (bp) to 2.50% at the August sitting.
The Three Month Bank Bill Swap fell by 17bp to 2.39%, reflecting many analysts’ expectations of an RBA rate cut.
Ten Year Bonds were largely unchanged, falling by 3bp, to end the month priced at 3.73%.
Australian equities bounced back in July following a couple of months of poor performance. The All Ordinaries Price Index subsequently gained 5.45% while the S&P ASX 200 Price Index gained 5.19%.
Australian Listed Property recorded a minor correction in July, with the ASX 300 A-REIT Price Index declining by 0.72% for the month.
Most of the major regional equities markets recorded gains in July, in an overall positive month for risk assets. European and British equities were the strongest performers with the STOXX 50 Price Index (Euro) gaining 9.19% while the FTSE 100 Price Index (UK) added 8.35%.
US Equities also posted healthy gains with the S&P 500 Price Index gaining 6.80% while Dow Jones Industrials Price Index added 5.79%.
The $US price of gold posted a sharp turnaround in July, ending the month priced at $US1478.58 per ounce for a gain of 9.24%.
Commodities in general performed well for the month, with the CRB Spot Commodity Price Index gaining 1.73%.
The Australian Dollar continued its decline, falling against most major currencies in July. In particular, the Aussie fell by 3.90% against the Euro and 2.74% against the Japanese Yen.
Equity market volatility declined for the month, with the VIX Index priced at 15.01 for a fall of 3.48%.
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