Volatility insights

Canopy Investors

August 2025

2 min read

Funds operated by this manager:

Canopy Global Small & Mid Cap Fund

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Chris Gosselin, CEO of FundMonitors.com, speaks with Benjamin Harrison, Chief Investment Officer at Altor Capital. 

In this conversation, Ben shares how the Altor AltFi Income Fund has delivered consistent performance over seven years, combining private credit investments with unique equity kickers. He also discusses their hands-on approach, focus on mid-market corporates, and where he sees the greatest opportunities for growth-making this a valuable watch for investors interested in private credit.

Hedge Clippings | 05 September 2025

Economic Growth Rebounds, but Rate Cuts Still a Waiting Game

Australia's economy found some momentum in the June quarter, with GDP rising 0.6 per cent (seasonally adjusted, chain volume) to leave annual growth at 1.8 per cent. For the 2024-25 financial year, the economy expanded by 1.3 per cent, according to this week's figures from the ABS.

Tom Lay, head of national accounts at the ABS, noted that "economic growth rebounded in the June quarter following subdued growth in the March quarter, which was heavily impacted by weather events." In other words, the headline numbers suggest the economy is not rolling over, but nor is it firing on all cylinders.

For monetary policy watchers, the timing is tricky. With the next RBA board meeting set for 29/30th of September, there are precious few key data releases between now and then. August's monthly CPI will provide a guide, but as it still won't contain the full data set until November, it will have to wait the all-important September quarterly inflation figures, which don't arrive until the 29th of October--just days before the RBA's November meeting, which, as usual, coincides with Melbourne Cup day.

That effectively leaves the RBA on the sidelines for now. While the latest GDP result offers some reassurance that growth hasn't flatlined, inflation dynamics will remain the key driver. Without the benefit of fresh quarterly CPI data, Michele Bullock and her colleagues are unlikely to cut rates in September. Market participants will therefore be circling November as the next realistic window for a move--if inflation co-operates.

In short, the economy has shown a touch more resilience, but borrowers may need to sit tight a little longer before any further relief on rates from the current 3.6% materialises. By then of course things might be clearer for Jerome Powell in the US, although it's fair to say that the only guarantee there is that Donald Trump's tariffs will loom large over their inflationary outcome.

As he will over the composition of the FED board itself.

There's rarely a dull day in Trumpland, or for that matter, Trump's World, although this week even The Donald Show was upstaged by President Xi and his cohorts in China. Meanwhile, it looks like Albo's travel plans to the UN in New York may yet include a long-awaited, and possibly overdue, meeting with the US President - as long as Trump's not too busy preparing for his own State visit to the UK, and a weekend in Windsor.

News | Insights

New Funds on FundMonitors.com

Manager Insights | Altor Capital

Market Update | Australian Secure Capital Fund

August 2025 Performance News

Bennelong Australian Equities Fund

Quay Global Real Estate Fund (Unhedged)

Bennelong Long Short Equity Fund

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What the Fed's shift from inflation to employment means for investors

Pendal

August 2025

SINCE December 2018, we've known Fed chair Jay Powell is not afraid to pivot.

Back then the Fed hiking cycle was forced to an abrupt halt when the US economy came under the strain of the first round of Trump's trade tariffs.

By the following October, the Fed had cut rates by 75 percentage points to 1.75%.

Powell's latest comments at last weekend's Fed's annual gathering in Jackson Hole, Wyoming, may prove to be another example.

In his speech, Powell acknowledged downside risks to employment, suggested further easing from the current "restrictive" policy stance may be appropriate and - for the first time in months - did not make this conditional on the inflation outlook.

Since these remarks, the US bond market has priced in an 85% chance of a cut at the next Federal Open Market Committee meeting in September.

This would take the upper bound of the Fed Funds target rate to 4.25%.

Sceptics view the move as Jay Powell bending to political pressure from President Trump.

The chart below suggests the Fed ought to be getting a little more worried.

US hiring and firing: NFIB Hiring Intentions and Initial Jobless Claims

Source: Bloomberg

The purple line shows the hiring intentions of US businesses, according to a monthly survey by the National Federation of Independent Business.

The yellow line is an inverted series of US initial jobless claims - a weekly series to reflect new joblessness.

The long-standing relationship between the purple and yellow lines is clear to see, and intuitive to grasp.

When businesses stop hiring, they eventually have to start firing. And vice versa.

When businesses feel the bottom is in, they stop firing, and then they start hiring.

This relationship seems to have dislocated of late. We need more time to see whether this is an actual dislocation, or one of those blips in the long-run data.

A possible explanation?

Perhaps businesses sense the slowdown and have paused hiring, but burned by the post-Covid labour shortages, are not yet willing to let people go.

A likely rate cut

September will likely bring a rate cut from the Fed.

Pendal's analysis of the long-term decision-making bias of the Fed leans heavily on market pricing.

In other words, the Fed doesn't like to surprise or disappoint (unlike some other central banks we know). That analysis also shows how sensitive the Committee is to labour-market dynamics.

If the Fed has now pivoted its focus from inflation to employment, we too should be looking at the best leading indicators for where labour markets are headed.

Funds operated by this manager:

Pendal MicroCap Opportunities Fund , Pendal Global Select Fund - Class R , Pendal Sustainable Australian Fixed Interest Fund - Class R , Pendal Focus Australian Share Fund , Pendal Horizon Sustainable Australian Share Fund , Regnan Credit Impact Trust Fund , Pendal Sustainable Australian Share Fund , Pendal Sustainable Balanced Fund - Class R , Pendal Multi-Asset Target Return Fund

 This information has been prepared by Pendal Fund Services Limited (PFSL) ABN 13 161 249 332, AFSL No 431426 and is current as at December 8, 2021. PFSL is the responsible entity and issuer of units in the Pendal Multi-Asset Target Return Fund (Fund) ARSN: 623 987 968. A product disclosure statement (PDS) is available for the Fund and can be obtained by calling 1300 346 821 or visiting www.pendalgroup.com. The Target Market Determination (TMD) for the Fund is available at www.pendalgroup.com/ddo. You should obtain and consider the PDS and the TMD before deciding whether to acquire, continue to hold or dispose of units in the Fund. An investment in the Fund or any of the funds referred to in this web page is subject to investment risk, including possible delays in repayment of withdrawal proceeds and loss of income and principal invested. This information is for general purposes only, should not be considered as a comprehensive statement on any matter and should not be relied upon as such. It has been prepared without taking into account any recipient's personal objectives, financial situation or needs. Because of this, recipients should, before acting on this information, consider its appropriateness having regard to their individual objectives, financial situation and needs. This information is not to be regarded as a securities recommendation. The information may contain material provided by third parties, is given in good faith and has been derived from sources believed to be accurate as at its issue date. While such material is published with necessary permission, and while all reasonable care has been taken to ensure that the information is complete and correct, to the maximum extent permitted by law neither PFSL nor any company in the Pendal group accepts any responsibility or liability for the accuracy or completeness of this information. Performance figures are calculated in accordance with the Financial Services Council (FSC) standards. Performance data (post-fee) assumes reinvestment of distributions and is calculated using exit prices, net of management costs. Performance data (pre-fee) is calculated by adding back management costs to the post-fee performance. Past performance is not a reliable indicator of future performance. Any projections are predictive only and should not be relied upon when making an investment decision or recommendation. Whilst we have used every effort to ensure that the assumptions on which the projections are based are reasonable, the projections may be based on incorrect assumptions or may not take into account known or unknown risks and uncertainties. The actual results may differ materially from these projections. For more information, please call Customer Relations on 1300 346 821 8am to 6pm (Sydney time) or visit our website www.pendalgroup.com