2016 played host to the unexpected with the U.S. presidential election and Brexit vote. 2017 will bring its own events that could have consequences for global markets.
As we prepare for the year ahead, we highlight some of the key events to keep an eye on in the first half of 2017, both in the U.S. and around the world. It is, of course, impossible to know how these events will play out, but being aware of the potential for volatility should help investors prepare for both the risks and the opportunities that could unfold.
Jan. 1: Euro anniversary
The start of the year marks the 15th anniversary of the full launch of the euro. Prior to January 2002, the euro had existed only as a virtual currency. The combination of Brexit and a sluggish economic outlook points to a European Union that is facing some serious headwinds. While there is still a strong political commitment to the EU in most member countries, some reforms may have to be made before long.
Jan. 20: U.S. presidential inauguration
Donald Trump’s election victory confounded expectations, although leaders on both sides of the aisle appear committed to ensuring a calm transition process. The policy priorities Trump sets out for his first 100 days in office may increase or decrease market volatility, depending on how far-reaching his aims are in terms of immigration, domestic spending, taxation, international trade and other matters.
March 26: Hong Kong elections
Elections in Hong Kong, the autonomous Chinese territory that serves as an important economic hub in Asia, are often controversial because of Beijing’s efforts to control the outcome. The election for a new chief executive — the head of the city’s government — could well follow that familiar pattern, particularly if the authorities opt to clamp down heavily on signs of dissent or pro-democracy activism during the campaign or once the result has been announced.
March 31: Brexit negotiations
The U.K. government has said it plans to trigger the Brexit process before the end of March. That will mark the start of formal negotiations on the U.K.’s exit from the EU. Depending on how the process is managed, those negotiations could help bring some stability to the U.K. economy, but they could also trigger further bouts of volatility.
