Many market participants expected a quiet 2016 but, as it turns out, nothing could have been further from the truth, says Architas chief investment officer Jaime Arguello
Speaking in the above video, which continues Professional Adviser's Architas Advent Calendar counting down to Christmas, Arguello acknowledges that the returns enjoyed by financial markets this year are surprisingly good given the economic backdrop and the extraordinary events that have characterised 2016.
Growth in the major economies ground slightly higher and inflation was notable by its absence, he points out. But the most outstanding feature of the year, he suggests, was the market's response to "two great binary events" - the EU referendum and the US election.
Arguello says: "In both cases the result was the opposite to what was predicted by the polls. The Brexit shock was largely felt in the currency markets as sterling's collapse saw a 30-year low against the dollar.
"The US election brought a further reset as Trump cruised to victory. The detail of his eventual policies has yet to be confirmed but his intention is clearly expansionary."
Arguello concludes: "As this remarkable year comes to an end, sterling investors will be glad to have got through it with such strong returns."
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