January Monthly Market Review

An excerpt from our January Monthly Market Review: Despite a mounting sense of foreboding, global markets were relatively placid in January. U.S. equities rebounded from December’s downdraft, and developed and emerging markets also rose. U.S. Treasury yields across the curve ended the month little changed. However, real interest rates declined, and inflation expectations rose. Credit markets were also calm with investment grade and high yield spreads remaining tight. Towards month-end, growing concerns over the impact of sweeping tariffs began to weigh on sentiment. This was most evident in the currency markets, with the Canadian dollar and the Mexican peso experiencing increased volatility. The U.S. dollar fell slightly against major currencies in January, following its appreciation last year. The dollar’s real effective exchange rate remains elevated, however. Commodity prices, including oil, rose in January. Reflecting the market’s unsettled nature, gold ended the month at yet another record high.

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