Key takeaways from Commonwealth Bank's 15th Global Markets Conference

Day 2 takeaways

1. Private capital is helping drive growth

Australia faces big spending challenges as it pushes to build new infrastructure and prepare for the future. Private capital can take on more risk and flexibility, filling funding gaps and making sure the country keeps moving forward even as needs change and projects get bigger. 

2.  The loan market is undergoing rapid expansion

The expansion is fuelled by rising demand from both lenders and borrowers, innovative deal structures, and Australasia’s strategic position within the Asia-Pacific region. Emerging themes like AI, technology, energy transition and urbanisation are expected to push annual volumes towards A$300 billion, with ripple effects across all sectors. This momentum is also driving growth in adjacent markets, including private credit and debt capital markets.

3. The Australian semis market is balancing fiscal strain and global appeal

Australia’s semi-government bond market sits at a crossroads—buoyed by global demand but challenged by widening state fiscal gaps. As some states face higher costs from infrastructure and population growth, investors still see semis as offering a rare mix of yield, liquidity, and quality.  

4. Australia and New Zealand are in investors’ good books

Australia and New Zealand stand out for fiscal discipline and funding flexibility amid global pressures. The Australian Office of Financial Management (AOFM) is maintaining investor confidence through a transparent strategy and a deep 30-year market. New Zealand Debt Management’s (NZDM) issuance has peaked, with debt expected to top out near 46% of GDP before a return to surplus by 2028. Strong demand, fuelled by diversification away from the US dollar, underscores trust in the stability of sovereigns Down Under. 

5. There are opportunities in South East Asia

But it will take dedication to improve the depth of our commercial engagements to invest more in the rapidly growing region and arrest a declining market share.  

6. AI is driving a massive investment cycle

We're rapidly replacing two decades worth of computing infrastructure. Well-positioned between the US and China, Australia has several advantages that give it to be a global player on data. But we need to get the energy infrastructure and policy settings right to take up that opportunity. 

7. Organised crime does not have a productivity – or an innovation – problem. 

On the downside of AI and other technological advances, cyber tools are now widely available, making attacks easier and more frequent—from criminals to nation states. Fighting this isn’t just about spending money; it demands smarter technology, faster detection, and strong collaboration across industries. 

Day 1 takeaways

1. Embrace flexibility and diversification.

In today’s new world order, defined by “multipolar” regional conflicts, adaptive globalisation and a massive investment boom in infrastructure and commodities, investors must pursue flexibility and diversification across countries, currencies and sectors, while focusing on companies with resilient, agile supply chains and multi-market reach. Prepare for rolling risks rather than a single crisis, and stay nimble as the global economic map is redrawn.

2. Coordination is key to Australia’s energy future

Australia’s vast solar and wind resources underpin rapid growth in renewable generation, but slower-than-expected progress in battery storage and transmission upgrades has created bottlenecks limiting the full potential of renewables. A coordinated national strategy that blends market reform, infrastructure investment and technology adoption is  key to ensure reliable, affordable and low-emissions electricity for all Australians.

3. Better data can help fix housing affordability.

By collecting accurate, up-to-date information and using robust analytical tools to analyse it, decision-makers can spot where housing shortages are most acute, track population changes, and see what’s working. This data-driven approach can make it easier to build the right homes in the right places, and help create stronger, more liveable communities. 

4. The bond market is always open if you’re prepared to be nimble

If you plan to tap the bond market during periods of significant volatility, such as after Liberation Day, do your homework and prepare to be flexible. This means disciplined pre-trade risk management and readiness to adjust your timing window as the situation evolves.

5. Australia’s ‘predictability premium’

While US and EU bonds have become less attractive, Australia’s government and state bonds offer solid returns at sovereign-quality risk. But what makes Australia stand out to investors amid today’s shifting global landscape is its ‘predictability premium’ – an orderly, well-organised market that’s good value and easy to trade in.  

6. America's AI GDP boost

America’s AI-driven capital spending is boosting GDP, but the benefits aren’t reaching most people. Unlike traditional infrastructure, data centres don’t create many jobs once built. This disconnect means the economy looks strong on paper, yet everyday workers feel little impact. To support the households and businesses that make up the real economy, borrowing rates may need to stay low – around 3.5% - even without a recession. The AI boom offers growth, but not the kind that trickles down.

7. Magnets are key to unlocking value in rare earths

Permanent magnets, which make up 95% of rare earth market value, are essential to EVs, wind turbines, fighter jets, and advanced electronics. But the supply chain is heavily concentrated: China controls around 60% of mining and 90% of processing and magnet production, built through decades of industrial policy. For Australia and its partners, the challenge and opportunity is to build resilient, end-to-end capabilities to reduce strategic risk and support the energy transition.

8. Liquidity and collateral management are the strategic frontier for Australia’s super funds

With half of assets offshore, FX risk and collateral constraints demand whole-of-fund thinking, not just hedge overlays. Precision liquidity tiering, stress playbooks, and board-level governance are essential to avoid forced selling and enable crisis buying. These shifts underpin member outcomes, performance tests, and systemic resilience. The challenge: embed liquidity strategy into investment design while co-ordinating with regulators and dealers to optimise collateral and crisis readiness.