Volatility spiked and equity markets slumped to their worst monthly performance since 2012 as investors' concerns escalated about slowing global growth and the impact of the looming US Federal Reserve interest rate hike. The New Zealand share market tumbled alongside global markets, finishing the month down 4.5%. Global bonds provided a relatively flat return over August which masked a volatile month for bond yields. The New Zealand dollar closed the month lower against all the major currencies. Investors continue to expect more interest rate cuts in the coming months. However, the significant fall in the New Zealand dollar is likely to negate the need for more aggressive action.
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