- John Rosier sells two holdings and has added the cash to the existing holdings
- Remains confident a period of robust returns is right around the corner
- No new additions to the funds portfolio
How August went, September continued. News on the inflationary front continued to be encouraging, no more so than in the UK. The fall in the headline rate for August to 6.7 per cent confounded forecasts that it would rise to 7.1 per cent. Even better, the core rate (excluding energy, food, alcohol and tobacco) fell to 5.9 per cent from 6.4 per cent. The news came just in time to persuade the Bank of England's Monetary Policy Committee to hold interest rates at 5.25 per cent. The Federal Reserve held rates steady, but warned it would not hesitate to raise rates further if required. The European Central Bank was the outlier, raising rates by 0.25 per cent to 4 per cent.
Harsh words from the Federal Reserve worked their magic. Treasury bond yields rose to levels last seen before the financial crisis. The 10-year Treasury yield ended the month at 4.6 per cent, and the UK 10-year gilt yield at 4.4 per cent. The US dollar also strengthened, gaining 2.5 per cent against the euro and 3.7 per cent versus sterling. Dollar strength combined with a rising Brent crude oil price – up 6.1 per cent to $92 a barrel – is unhelpful in the fight against inflation.