Dear valued client,
Markets found more solid ground this week despite investors being concerned Central Banks might not cut rates as soon as they’d hoped. More evidence of this appeared with elevated Canadian inflation numbers; the CPI came in at 3.4% in December – exactly on par with the U.S. – compared to 3.1% in October and November.
On the geopolitical stage, China has made it very clear they are not pleased with Taiwan’s new president. This past Saturday, Taiwan elected Lai Ching-te – marking the third consecutive victory for the Democratic Progressive Party and a decision that angered officials in Beijing who labeled Lai a “troublemaker” and “separatist.” In response, China will likely increase military pressure and impose trade restrictions to dissuade Taiwan from notions of independence. Though a remote possibility for now, a full-scale invasion of Taiwan by China would have a $10 trillion impact on global GDP, according to Bloomberg.
In U.S. political news, Donald Trump dominated the Republican Iowa caucus this week with close to 50% of the vote, almost guaranteeing his nomination for the presidential election later this year. The action now moves on to New Hampshire, which votes next week.
After only three weeks into the New Year, 46 tech companies, including Google, Amazon, and Apple, have laid off a total of roughly 7500 employees. Though worrisome for employees in the sector, this is likely not a rerun of 2023 where nearly 263,000 jobs were cut following the supercharged growth during the pandemic. Rather than sweeping cost-cutting efforts, these layoffs likely reflect tech companies’ shifting priorities to AI investment and other innovative projects.
In honor of MLK Jr. day this past Monday…
“Life’s most persistent and urgent question is, ‘What am I doing for others?’” – MLK Jr.
Have a terrific weekend,
PW
