Hedge Clippings | 17 July 2026

Two data releases, and one disruptive dog dominated Hedge Clippings' attention this week; Victoria's unemployment cracked 5%, and economists laid out their forecasts ahead of next week's CPI. Finally, our FY2026 Fund Manager Review lands with a lesson worth reading before you look at a single year's return.

National jobs beat forecasts, but Victoria's unemployment rate just hit 5.1%, its worst since 2021

This week's ABS's June labour force data beat expectations comfortably. Employment rose 76,000 against a forecast of 15,000, split between 47,000 part-time and 29,300 full-time jobs. National unemployment held at 4.4%, in line with consensus, though participation rose 0.3 points to 67.0% and underemployment ticked up to 6.5%.

The state breakdown told a less comfortable story. Victoria, the state long considered an economic basket case under ex-Premier "Chairman" Dan Andrews, continued its decline with unemployment jumping to 5.1%, the highest of any state, and the worst reading in Victoria since October 2021. MacroBusiness's Leith van Onselen has flagged Victoria's structural weakness for months: the lowest private business investment per capita of any mainland state, the highest state debt, and a manufacturing sector in long term decline.

A national beat masking a genuine two speed labour market. Victoria's weakness looks structural, not seasonal, and it is worth watching whether other states start following the same investment starved path.

Next week's CPI is the RBA's real decision maker: here's what the market expects

Next Wednesday's June CPI release is shaping up as the more decisive input than this week's employment data for the RBA's 11th of August meeting and rate decision. The RBA's own May forecast expects headline inflation to peak around 4.8% in the June quarter before easing, with trimmed mean staying above 3% until mid-2027. Bank previews ahead of May's data had trimmed mean clustered at 3.5 to 3.6% annually, and the actual number landed at 3.6%, the highest since September 2024. For the June quarter, banks are pencilling in quarterly trimmed mean around 1.0 to 1.1%, keeping the annual rate uncomfortably sticky. The wildcard is the fuel excise relief, which only partly expired on the 30th June and is due to end on August the 2nd just as the price of crude oil tops US$100 again. If the levy relief lapses, headline CPI could reaccelerate even if trimmed mean, the RBA's real focus, tells a different story.

The RBA watches trimmed mean, not headline inflation. A rising underlying rate alongside a resolved excise question would put a further hike back on the table for August, whatever the jobs data says.

Reading a fund's one year return? Read this first

Our FY2026 Fund Manager Review , covering 18 peer groups and 988 funds with complete year returns, carries a lesson worth applying to any one-year performance table you look at. The year's ten strongest results all shared one thing: concentrated exposure to a single theme that dominated for three quarters, despite reversing sharply in the final one. Several of the year's best performers now sit 30% or more below their own high water marks, meaning last year's league table already describes a story that has moved on. The 2026 Review also looks at consistency across 1, 3, 5 and 7 year horizons, and finds two very different stories of it. One comes from genuine, repeatable skill. The other comes from structural leverage, gearing or concentration that mechanically amplifies whatever the market is doing, in good years and bad. Both are real and can produce a first place ranking. Only one gives an indication about what might happen next. The report also flags that eye catching risk-adjusted ratios in some unlisted credit sectors reflect valuation smoothing rather than an absence of risk.

The dog that out-traded the news cycle

Barnaby Joyce paused a live ABC interview this week to shout "Sit down!" to his dog Stella, and the news clip instantly out-traded the day's actual policy news. Markets take months to price in forward guidance. Stella got the message in one shout.

News | Insights

Annual Fund Manager Performance Review, FY2026 | FundMonitors.com

Quarterly State of Trend report - Q2 2026  | East Coast Capital Management

Trip Insights: Europe  | 4D Infrastructure

June 2026 Performance News

Airlie Australian Share Fund

Bennelong Emerging Companies Fund

Insync Global Quality Equity Fund

DAFM Digital Income Fund (Digital Income Class)

Quay Global Real Estate Fund (Unhedged) Active ETF (ASX:QGRU)

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Global ABS 2026: Strong Technicals, More Selective Tone

Challenger Investment Management

July 2026

(6-minute read)

Challenger IM Credit Income Fund , Challenger IM Multi-Sector Private Lending Fund

For Adviser & Investors Only

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