Council's investment portfolio as of June 30, 2022 had a current market value of $235,582,956.29 which is lower than the investment portfolio's face value of $236,029,478.55.

Councillor Matthew Wright said he was in a "mixed mood" when seeing the large figure in the investment portfolio.

"I'm excited about the fact some of our investment returns over the next four months will increase with interest rates increasing, so I'm looking forward to a bit of extra money come through in interest," he said.

"It probably concerns me about the rising cost of inflation with the amount of money sitting in the bank, so I guess I'm curious to see how that plays out over the next couple of years as inflation challenges our account."

Interest earned on investments has been included within council's 2021/22 operational plan, with total income generated from the investment portfolio forecast to be in excess of $2,554,280.00.

Mayor Mathew Dickerson said there would be many people "curious" to see how the inflation plays out.

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Deputy mayor Richard Ivey said $235 million was no "mean" amount of money but would like more information on the movement of those funds.

Cr Ivey said he would like to be able compare the amount to previous years and what the movements have been throughout the year by way of redemptions, contributions and change of values on individual investments.

"If that could be done relatively easily that might provide councillors with a little bit more information of the state of play of our fixed investments," he said.

Since March 2022, the market has seen a significant steepening in the yield curve and a widening in credit spreads which affects bond valuations, according to a report by Dubbo Regional Council's chief financial officer Michael Howlett.

"The main reason for the recent declines in bond valuations is due to the current global pandemic uncertainty, a sharp unexpected increase in inflation and the war in Ukraine," he said.

According to Mr Howlett, Central Banks globally are now swiftly raising interest rates to contain the rapidly rising inflation.

"This is a change in strategy as the Reserve Bank of Australia was communicating early this year that the rates were anticipated to remain at record lows until 2024," he said.

"Council's strategy is to hold bonds until maturity when the full face value will be paid."

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