The threat of rising inflation, and all its associated baggage, finally hit markets in a meaningful way over the last few weeks, after threatening to do so for months. Global equities fell just over 5% (in US dollar terms) over the last month, which is never a nice feeling. Particularly when it hasn’t happened in quite a while. The decline through to Thursday was the first 5% market pullback in over a year. It was also the first time a new bull market had not seen a 5% fall in its first 12 months. Currency movements also softened the blow for Irish investors. So, as mentioned above, never a nice feeling but perhaps not as alarmist as many a headline will claim.
Nevertheless, it has never paid to be dismissive of such market movements, and we remain vigilant to the effects of shifting monetary and fiscal policy (more on both below). Any shift or transition in the fundamentals underlying the global economy can come with bouts of volatility and can be at times a difficult road to navigate. Maintaining an active, flexible approach, with a proven investment process, will continue to provide opportunities on the road ahead.