Hello,

A collection of the world’s most prominent leaders convened at the 2026 World Economic Forum in Davos last week, and the assembly produced its usual share of dramatic moments. US President Trump delivered a speech in which he said “I won’t use force” to take Greenland and later dropped the threat of tariffs after talks with NATO chiefs. Looking past the noise, the more useful question for portfolios is the impact on the market itself.

It was a busy economic calendar for the UK in particular. The unemployment rate held at 5.1% in November, in line with expectations. Headline CPI inflation ticked higher to 3.4% in December, slightly above forecasts of 3.3%. Retail sales for December grew 0.4% versus November, beating expectations for a 0.1% contraction.

In Europe, the Eurozone inflation rate for December was revised lower to 1.9%, below the ECB’s 2% target. The German ZEW index climbed to 59.6, its highest level since July 2021 and well above expectations of 50.0. Gold rose 6.4% in euro terms as volatility lifted demand.

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Smart Financial Insurance Limited trading as Smart Financial is regulated by the Central Bank of Ireland. Past performance is not a reliable guide to future performance. The value of your investment may go down as well as up.