 And welcome to FIG's weekly economic and trading update. I'm Mark Bailey and this is Jessica Russett. So Mark, this week the RBA came out and discussed their concerns still with the property prices and also spoke that there's potentially a property bubble at the moment. We also saw some weakening in the commodity space as well with the iron ore price coming off a bit there. Talk us through it. Yes, there's been a lot of data on house prices. We had some house price data out of Australia as well, again showing strong growth. And as you say in the RBA minutes, they're saying there's associated risk building up in that property sector in the housing sector. And as a result, ASIC and both APRA have been coming out and saying, look, we're looking at this space. And so they may actually start to again reduce the amount of loan growth that you're seeing in certain parts of their loan books, especially probably more on the investor side of things. So it's just something for investors to be aware of. And also, as you rightly pointed out, there has been some volatility in the commodities complex, iron ore and oil has come off its recent highs. And that's fed through into equities as well. So you've seen a bit of a wobble on the global equity markets. Interestingly, there's been a bit more commentary as always happens when you do get a bit of volatility in the space about our equities overvalued. There was a Bank of America survey of institutional investors that said, yes, for the highest percentage for a long time that US equities especially are overvalued and maybe time to move into more defensive assets. And also, Dennis Gartman, who produces a Gartman letter, which is a very well read and researched letter, daily letter to investors. He said he's actually gone short equities for the first time in a very long while. So again, just highlights to investors that now is a really good time. You haven't had a major correction to just really address and look at the risks and the returns and make sure they're comfortable with the overall asset allocation because at the moment, potentially equities are really overvalued and maybe it's time to take some profits and take a bit of money off the table. So Jess, what's been rumbling in your jungle this week? Well, we've actually seen a trend emerging where clients have been adding more investment grade bonds and also high rated bonds to their portfolios. So it seems to be a little bit of a safe haven play and clients taking a bit of risk off the table and just adding and more of a diversified allocation. Also, it's shorted dated allocation as well to their portfolios. So we had the tier two floating rate note investment grade bonds that were quite highly traded last week. So it was the AAI 2020 call floating rate note and also the Bendigo and Adelaide 2021 call floating rate note. Both of these are actually only available to wholesale clients, although last week I did speak about those two tier two bonds that retail clients can participate in. So both of these bonds come to clients at an indicative projected call yield of four and a half percent, which is quite attractive for the investment grade that they both are. We've also seen clients looking also in the senior debt space as well. And so it was the down 2022 maturity bonds and also Fitch reaffirmed their outlook and rating for those that bond post the offer on spotless. That's right. And the other floating rate note investment grade senior debt bond is the DBCT21 floating rate note. That's a Darwimple Bay. Coal terminal. That's correct. Yes. And so the DBCT comes at a projected indicative yield to maturity of 4.7 percent and the down and 22s I spoke about comes to clients at 4 percent. So these aren't the highest yielding offering that Fitch has for client. But the point is that it's a more conservative approach to the portfolio. And we have noticed that clients have been reassessing in certainty in the markets at the moment and have been putting in these allocations just as a bit of a safe haven play. And so usually we have a lot of clients chasing high yield, which is still the case, but there does seem to be a bit more of a reserved and reassessed approach we're seeing in the portfolio allocations at the moment. I think that's great to see from my side because that's what we've been talking to investors for the last six to 12 months in terms of where we are in the credit cycle, what we're trying to achieve in terms of that portfolio. And especially as we've talked about equities just starting to wobble, it's a good time to assess their asset allocation, move a bit more defensively to protect that downside. And it sounds like clients are listening and also action in on some trades as well. Yeah, that's right. And I mean, we have always traded these lines, but I certainly couldn't say that six months ago we saw the interests and the demand in them that we are seeing at the moment. So this upcoming week we have a GDP figures out of the US. What else should investors be aware of? Yeah, Jess, that's a fairly big print in terms of economics, looking for around about 2% for the GDP print. Also looking for the Fed's preferred measure of inflation, the core PCE that is out later on in the week. And also some important PMI figures out as well. It's a very, very light data week for Australia. So the focus will definitely be across the Atlantic in the states for the data. So Jessica, what's going to be interesting for you next week? Yeah, sure. So there has been demand in the US dollar denominated space for investment grade bonds as well. So we'll be focusing on trying to find a bond to add to our direct bonds list. That's also of investment grade. And this will allow clients to reallocate and look at rebalancing their US dollar portfolio and potentially moving out of some unrated and into the investment grade space. Great. Sounds a very sensible option again. You know, carrying the theme. That theme, correct. Yeah, exactly. Thanks, Jessica. Thanks, Mark. And thank you for watching. If you need any more information, please go to The Wire.