Quarterly Commentary – January 2024

Is it just me, or does it feel like we have been dealing with an uncertain economy for a long time?  It has only been 2 years since things began to slide, but it feels like a decade!

2022 saw significant drops in the investment markets, inflation was high, interest rates were going higher, and geopolitical issues had risen to the fore.  2023 was supposed to be the year things would stabilize, but I can’t say we are there yet.

When 2023 began, my feeling was that the investment markets would give us a positive return… something in the 5% to 6% range… but there would still be a decent amount of ups and downs.  Well, in the end, I was right about one part–  the ups and downs.

By the end of August, things were trending upwards and my feeling for gains of 5-6% seemed legitimate.  Then, September and October saw the markets go backwards and we gave back almost everything we had gained to that point in the year.  Then, the perfect Santa Claus Rally occurred in November and December, and we finished the year much higher than what I had expected.  I like those kinds of surprises!

Looking forward, 2024 begins with a couple key factors in play.  Inflation is much lower than this time last year, and it appears to be trending downwards.  Current indications are interest rates are as high as they are going to go and it’s only a matter of when they begin going down… the questions are when, and how fast?

My general feeling for the investment markets in 2024 is the first half will continue to be fairly volatile while we confirm the inflation and interest rate directions.  Then, assuming inflation rates continue downwards, interest rates are likely to drop, and I feel the second half of the year will be fairly positive for the investment markets, leading to a decent gain for the year.  Of course, the national and global economies will have a lot to say about this, let alone geopolitical events, but all things being equal, I believe 2024 will be a decent year for our investments.  I do not expect sunshine and roses all the way through, but it I like the potential.

Also, a friendly reminder that the RRSP deadline this year is February 29th.   For those wishing to make an RRSP contribution this season, please keep this in mind and let us know if we can be helpful in any way. 

In the meantime, I hope 2024 has started well for you and your family and I will look forward to keeping in touch.

All the best, 

Bryson