BNY Capital Market Perspectives

Resistance is Futile – Volatility at lows Across Multiple Asset Classes

Global risk concerns continue to wane, with elections pushing back on populous revolts, while geopolitical risk have calmed recently, although we have seen nary a blip of concern over geopolitical issues over the past several years. The French elections were almost a textbook example of polling accuracy, as the 2 candidates that were expected to advance to the 2nd round did just that. The ultimate victory for Macron was also as predicted, by some measures many months ago. We have therefore seen anti-Euro candidates falter in Austria, Holland and France over the past 6-months, alleviating much of the concern that another Brexit was lurking on the horizon. As for US politics, we sense that activity from Washington is mostly discounted for the current fiscal year, but not yet abandoned as many still expect some form of tax reform, fiscal stimulus and/or deregulation to emerge in the coming year.

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