The Reserve Bank's cut yesterday took some of us by surprise, so it's important to understand what it looks at when it's making important rate movement decisions.
The growing calls for a reduction in interest rates may be more fuelled by FOMO (fear of missing out) than the actual data, which is actually starting to improve.
The International Monetary Fund has downgraded its expectations for global growth, but if you dig into the numbers, all is not as bad as it first appears.
It might have been tempting to start expecting an interest rate cut, but the data now suggests that although the RBA has an (unspoken) easing bias, rates should remain on hold for a while yet.
On the surface, the market didn't seem to go anywhere in 2014. But add in dividends and franking and it did much better than cash. With a slightly brighter 2015 expected, total returns in equities should be solid.
We need cool heads willing to focus on growth and bolstering sentiment, rather than trying to get unachievable spending cuts through an increasingly populist Senate.
The recent news might all seem negative but, actually, earnings are due for a period of above-trend growth and the medium-term outlook for the Australian equity market still looks favourable.
Rates were left on hold yesterday but it looks like the Reserve Bank is starting to flirt with the idea of moving lower, particularly if the Aussie dollar doesn't drop further.
The latest interest rate cut by the Bank of China shows the authorities are still very interested in keeping the economy going. Meanwhile, equities have been underplayed and look like very good value.
Despite the fact Japan once again appears in â€˜recessionâ€™, aggressive monetary stimulus underway by the Bank of Japan suggests now might be a good time to consider Japanese equities.
Interest rates could be on hold for another 12 months, which means it's time to make sure you're getting the best offer from your bank.
I suspect the real reason many central banks are still flooding markets with liquidity is to engage in a kind of guerrilla global currency war.