Retail Savings and Investments in Australia 2009 -Part 1 Market Focus

Published by: Datamonitor

Published: Apr. 30, 2009 - 107 Pages

Table of Contents

Overview

Catalyst

Summary

Executive Summary

After a period of rapid growth the Australian economy cooled off in 2008

In 2008, growth in total retail savings and investments slowed to its lowest rate in five years

Deposits are the largest S&I vehicle in the Australian market

The retail equity market crashed in 2008 as global economies fell into a downturn

Datamonitor forecasts the retail S&I market to gradually improve to 2012 as the Australian economy slowly recovers

Table of Contents

Table of figures

Table of tables

Market Context

Australia saving and investment growth curbed as a result of a weaker economy

In 2008, growth in total retail S&I slowed to its lowest rate in five years

Investors returned to deposits as equity markets declined sharply in 2008

Saving and Investment Assets

Investors have returned to low risk deposits with investment markets falling

Deposits have been growing strongly since 2003

Deposits are the largest S&I vehicle in the Australian market

The Australian economy has paved the way for deposit growth in recent years

Mutual funds expanded quickly before retreating in 2008

Mutual funds balances declined in 2008 as the equity market crashed

Mutual funds are the second largest S&I vehicle in the Australian market

Equities were hit hard in 2008 after phenomenal growth in prior years

The retail equity market crashed in 2008 as global economies fell into a downturn

Retail equity balances have been hardest hit as investors shifted money out of the falling market

Bonds continue to represent only a small proportion of retail portfolios

For the most part, the retail bond market has been in decline

Bonds are the smallest component of the retail S&I market

Future Focus

Datamonitor forecasts the retail S&I market to gradually improve to 2012 as the Australian economy slowly recovers

The Australian economy is expected to remain weak in 2009 as recession takes hold

Aggregate retail S&I are forecast to expand 6.8% compounded annually between 2008-12

Equities are forecast to proportionally increase the most of any retail asset class up to 2012

APPENDIX

Data tables

Methodology

Further reading

Ask the analyst

Datamonitor consulting

Disclaimer

List of Tables

Table 1: Benchmark of macroeconomic factors on the Australian market, 2003-08

Table 2: Actual figures of macroeconomic factors on the Australian economy, 2003-08

Table 3: Historic values of Australian retail savings and investments, 2003-08

Table 4: Historic asset proportions of total Australian retail S&I market, 2003-08

Table 5: Historic year-to-year growth of Australian retail S&I assets, 2004-08

Table 6: Forecast values of Australian retail savings and investments, 2003-08

Table 7: Forecast asset proportions of total Australian retail S&I market, 2003-08

Table 8: Forecast year-to-year growth of Australian retail S&I assets, 2004-08

Table 9: Historic CAGR, 2003-08 and forecast CAGR, 2008-2012

List of Figures

Figure 1: The Australian economy cooled off in 2008 after a strong run

Figure 2: Retail equity balances have mirrored the movement of the Australian share market

Figure 3: Equities are expected to start recovering after weathering a volatile year ahead

Figure 4: The Australian economy cooled off in 2008 after a strong run

Figure 5: Growth in retail S&I assets cooled off in 2008 as equity and mutual funds balances declined

Figure 6: In 2008, there was a flight to safety from Australian investors as they flocked to deposits

Figure 7: Australian retail deposits grew at a compound annual rate of 10.8% between 2003-08

Figure 8: The proportion of total retail S&I held in deposits surged in 2008 as the local equity market crashed

Figure 9: Increases in average income and a flight to safety have helped drive deposit growth

Figure 10: Retail mutual funds balances have followed the performance of the Australian stock market

Figure 11: In 2008, the proportion of total retail S&I represented by mutual funds declined to its lowest share in six years

Figure 12: Retail equity balances have mirrored the movement of the Australian share market

Figure 13: The proportion of total retail S&I held in equities decreased sharply in 2008

Figure 14: The value of retail bond balances has been declining since the recent high in 2005

Figure 15: Retail investors have only a very small share of their total S&I balances in bonds

Figure 16: The retail S&I market is forecast to slowly recover over the next four years after a rough 2008

Figure 17: During 2009, deposits are forecast to represent for a larger share of the S&I market while equities and mutual funds are expected to decline slightly

Figure 18: Equities are expected to start recovering after weathering a volatile 2009

Abstract

• Historic balances for Australia's retail savings and investments between 2003-2008.
• Forecast retail balances up to 2012 derived from the Australian Savings and Investments Forecasting model.

• Discover the influencing macroeconomic factors that have led to growth in the Australian retail savings and investments market between 2003-08.
• Review which Australian retail savings and investments asset is forecast to generate the fastest growth up to 2012.

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