Markets don’t like surprises—and when reality turns out worse than expected, volatility tends to follow. That’s exactly what we’re seeing now.
What's Happening?
The U.S. recently announced a new round of tariffs. While these had been anticipated, the scale and breadth caught investors off guard. Markets are reacting to the surprise, especially with retaliatory tariffs set to begin on April 9th. The primary concerns? That tariffs may drive up inflation and put pressure on economic growth.
How long this volatility lasts is uncertain. It may be short-lived, as we expect, or it could take longer to work through. But amid the headlines, it’s important to remember that not all the news is negative.
Reasons for Optimism
1. Global Trade Negotiations Underway
Several countries are already working with the U.S. to negotiate lower tariffs. The administration views itself as focused on making deals—so we could see progress quickly.
2. Interest Rates Are Falling
Lower rates are a tailwind for the economy. They reduce the cost of borrowing, improve bond performance, and help ease the federal government's debt burden. Every percentage point lower in interest rates saves billions in interest payments.
3. Oil Prices Are Down
Crude oil has dropped to around $60 per barrel. Lower energy costs filter through the economy, reducing expenses for businesses and consumers alike.
4. Tax Policy in Focus
Congress is currently working on a new tax bill. At a minimum, we expect the extension of reduced tax rates. Additional cuts could also be on the table—potentially providing another boost to the markets.
5. Manufacturing Momentum
Over the last few months, $5–7 billion in new U.S. manufacturing investments have been announced. While it takes time for these projects to develop, they are a positive long-term indicator of domestic economic strength.
6. A Pro-Growth Policy Approach
Regardless of political opinions, policies focused on tax relief and regulatory reform generally support business investment and economic expansion.
What Should You Do?
Periods like this are a reminder of how important it is to have a portfolio that aligns not just with your risk tolerance—but with your stage in life. Many of our clients remain confident during times like these because we’ve positioned them thoughtfully and proactively.
If you’re uncertain about your current investment strategy—or if you’d simply like a second opinion—we’re here to help.
Give us a call at (803) 736-3406 to schedule a conversation and review your plan.