It has been reported that residential property prices have decreased 10% over the past year, with banks providing less credit for housing loans and lending criteria becoming more stringent in a rising interest rate environment. Some economists are forecasting that the Reserve Bank of Australia will continue to increase interest rates throughout the next year. Against this backdrop, the US Federal Reserve is also predicted to continue to increase interest rates.

Required: Discuss some ways in which TAA might be used in this situation given these expectations, and provide recommendations on how you would adjust the weightings for each asset class in the SAA provided in the case study.