Discount rate update - September 2021

Update on Market Discount Rates as at 30 September 2021

The market was relatively flat over the quarter to 30 September 2021 with the ASX rising only 0.3% since June 2021 despite stronger earnings growth expectations. With the risk-free rate remaining unchanged, this implies an increase in the EMRP and market discount rates over the period as set out below.

Market discount rates have declined slightly

Sep 2021

Jun 2021

1.49%

Index level (All Ords)

7,630

7,585

Forward PE (All Ords)

17.8x

19.2x

EMRP

6.75%

6.5%

Market cost of equity

8.2%

8.0%

Source: Leadenhall

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