December Monthly Market Review

An excerpt from our December Monthly Market Review: The U.S. equity market gave up some of its earlier strong gains in December holding the return for the year to a mere 25%. Non-U.S. advanced and emerging equity markets also declined in December but rose in 2024, albeit less extravagantly. The Fed’s decision to cut its policy rate by 25 basis points in December was widely anticipated, but the hawkish tone of its forward guidance was not, contributing to a steepening U.S. Treasury yield curve and increased policy uncertainty. The prospect that expansionary fiscal policies under the new administration might be met by tighter Fed policy fueled the increase in longer-term yields. This constellation of policies, combined with expectations for an increase in tariffs, also contributed to an appreciation of the U.S. dollar against most major currencies. Oil prices rebounded in December but remained marginally lower for the year. Gold and Bitcoin prices fell in December but were up sharply in 2024 and remained near record highs.

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