PROFESSIONAL DESIGNATIONS | CFP, CIM, FCSI, RIS, CHS
As we start the new year, let’s quickly review 2023. Investors faced many challenges last year, including elevated inflation, interest-rate hikes, geopolitical conflicts, and a slowing global economy. That said, those who were patient and rode out the volatility were...
It’s fair to say that everyone is happy to see September end, at least from an investing standpoint. It was a month full of market volatility due to stickier inflation data and the U.S. Federal Reserve’s commitment to higher-for-longer interest rates. The markets had been expecting central banks to already be discussing rate cuts, but that hasn’t been the case. On top of that, September tends to be one of the worst months historically for the stock market, and this year was no different.
Near the end of September, the markets were looking toward the risk of a government shutdown, that ended up being kicked down the road.
Investment Focus | Issue 16 | Staying Steady Amidst Economic Shifts: US Debt, Canadian Rates, and Recession Outlook
The likelihood of a recession in Canada is a topic creating buzz among experts. Accountancy firm RSM Canada projects a 60% chance of a recession occurring by the end of 2023, although they believe it would be relatively mild and short-lived. They anticipate that specific sectors, like the labour market, could potentially shield a significant portion of the economy from recessionary effects.
It’s been a hard year and not the one many hoped for coming out of a two-year pandemic! Unfortunately, the solutions to our economic problems in 2020 and 2021 are now the catalysts for the terrible year we have had so far in 2022.
Our advice for ourselves and for our clients is the same. Stay the course, avoid the headlines, and don’t look at your portfolio value every day. Don’t reduce your wealth by making decisions based on emotions.
It has been a volatile start to the year.
We’ve had 30-year highs in inflation, interest rate increases, Covid, the Ukraine/Russia conflict, and China lockdowns. There’s even talk of a European recession next year and potential American recession in late 2023. All of this has caused negative returns in every asset class, especially in the tech space and smaller companies.