As expected the Reserve Bank of Australia (RBA) raised the cash target rate to 6.25% at time of writing. The Bank stated that headline CPI (3.9%) "reflects some temporary influences which will be reversed in the quarters ahead". However, the Bank felt that a somewhat "more restrictive stance of monetary policy was required to moderate inflation over time, and thereby secure sustainable growth".

The S&P/ASX 300 Property Accumulation Index returned 0.9% for the month, underperforming the broader Australian share market. The sector is trading on a forward yield of 6.2%, a discount (0.2%) to the 3-Year bond and slight premium (+0.5%) to the 10-Year bond. The forward yield premium is below historical averages of 1.8% (3-Yr) and 1.7% (10-Yr). The market continues to price the sector based on growth opportunities rather than historical valuation metrics.

The S&P/ASX 300 Accumulation Index returned 4.7% for the month. The drivers over the month were stock specific rather than style orientated, with the indices for growth (Macquarie Growth: +5.0%) and value (Macquarie Value: +4.6%) performing roughly in line. Merger and Acquisition (M&A) activity continued in October with the Media sector the focus following changes to the regulatory framework.

Japanese economic growth remains robust. The current economic growth cycle, that began in February 2002 is set to surpass the "Izangi boom" (1965-1970) and become the longest economic expansion since WWII.