The company said the median growth fund was likely to post a return of about 8.5 per cent, a significant turnaround on the previous year’s loss of 3.3 per cent.

“A final result close to that figure would be a tremendous outcome considering the challenging economic backdrop and would easily erase the losses … from the 2022 financial year,” Chant West senior investment research manager Mano Mohankumar said.

He said the resilient share markets were the main driver of the return.

“At a time when many Australians are feeling financial stress due to high inflation and the surge in interest rates, the better-than-expected financial year return would provide some good news,” he said.

“It’s a reward for super fund members who have remained patient and maintained a long-term focus.”

He said the 2022 financial year closed with a final quarter loss of 5.5 per cent amid surging inflation and uncertainty about when interest rate rises might come to an end.

“At that time, we didn’t think that a year down the track, we’d be looking at a solid annual return in the order of 8.5 per cent, so it’s another reminder to put short-term setbacks to one side and focus on the long game,” he said.

“In the month of May, Australian shares fell 2.5 per cent, international shares were down 0.2 per cent in hedged terms, but the slight depreciation of the Australian dollar pushed that into positive territory at 1.2 per cent in unhedged terms. Bonds were down due to rising yields, with Australian and international bonds retreating 1.2 per cent and 0.5 per cent, respectively.

“In the US, concerns around the debt ceiling negotiations weighed on market sentiment although a deal was finally reached in early June. The Federal Reserve raised interest rates by 0.25% in May.”

Chant West said up until the end of May, all-growth funds had returned 10.6 per cent, high growth 9.7 per cent, growth 7.6 per cent, balanced 6 per cent and conservative 4.4 per cent.