Retail Savings & Investments in Australia: Coronavirus (COVID-19) Sector Impact

Retail Savings & Investments in Australia: Coronavirus (COVID-19) Sector Impact

Summary

The Coronavirus (SARS-CoV-2) outbreak, dubbed COVID-19, is first and foremost a human tragedy, affecting millions of people globally. The contagious Coronavirus, which broke out at the close of 2019, has led to a medical emergency across the world, with the World Health Organization officially declaring the novel Coronavirus a pandemic on March 11, 2020.

Fears surrounding the impact of COVID-19 have significantly impacted the global economy, with key stock markets across the world losing 20-50% of their value year-to-date. Many economists and institutions have cut their forecasts, with many experts predicting the potential onset of recessionary environments.

A similar trend is expected in Australia as well, as economic growth is expected to register a dip in the first quarter of 2020 and will decelerate further if this disease continues to spread over the coming months. The decline will have an adverse impact on all sectors including retail investments.

This report focuses on the impact of the Coronavirus outbreak on the Australian economy and the country’s retail savings and investment market. It also highlights the measures adopted by the government to combat COVID-19. Based on our proprietary datasets, the snap shot contrasts GlobalData’s pre-COVID-19 forecasts and revised forecasts of total retail bond, deposits, equities and mutual funds holdings in terms of value and growth rates. It also analyses the effects on HNW wealth, examining the importance of different industries as a contributor to HNW wealth.

Scope

- The Australian retail savings and investment market is forecast to contract by 1.1% in 2020 before recovering the following year.
- Mutual funds and equity holdings will suffer the most pronounced declines of 16.1% and 11.1% respectively over the course of 2020.
- As consumer confidence has hit a five-year low, investors are looking for the safety of deposits and we forecast retail holdings to increase by 8.8% in 2020.
- Some segments of the Australian high-net-worth (HNW) market will be more affected than others due to their exposure to different industries. Those employed in the retail, fashion, and luxury goods industry as well as the real estate sector will be hit particularly hard. Together, these sectors account for 11.4% of HNW wealth.
- Those involved in the FMCG industry are expected to benefit as demand for staples remains high. HNW wealth sourced from this sector accounts for 5% of total HNW wealth.

Reasons to Buy

- Make strategic decisions using top-level revised forecast data on the Australian retail savings and investments industry.
- Understand the key market trends, challenges, and opportunities in the Australian retail savings and investments industry.
- Receive a comprehensive insight into the retail liquid asset holdings in Australia, including deposits, mutual funds, equities, and bonds.