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The month of March witnessed continued caution by investors ahead of the much-awaited White House announcements on reciprocal tariffs on April 2nd, 2025. The confrontational posturing of the Trump administration towards United States’ trading partners had investors braced for some form of an adverse outcome. Taking cues from the announced objectives of the White House on trade imbalances, investors tried to gauge and discount the extent and magnitude of the tariffs and re-priced risk assets. The S&P 500 Index was down by ~-5.75% and the S&P TSX was down by ~-1.87% during March. The expectation among market participants was that the Trump administration team is working in the background to analyze the tariff and non-tariff barriers of its trading partners (an arduous task), which gave an appearance that the reciprocal tariff policy would be based on sound economic reasoning. Market participants also held on to hopes that lifting the uncertainty could support the markets after the sell-off. To their surprise, the scope and extent of tariffs announced were much larger-than-expected and were based on a simple mathematical formula with questionable logic.  In response to the reality of what these tariffs would imply for corporate profit margins, inflation, and global economic activity, the global markets sell-off accelerated immediately after the announcements. In our previous update, we alluded that for the probability of the market outlook to improve from here, either the Trump administration must capitulate as the adverse market reaction builds pressure and/or the opposition finds its footing and stages a push bask. As of this writing, markets are rallying as the United States President has announced a pause on the tariffs for 90 days on countries willing to negotiate. He also announced a hike of tariffs to 125% on China as it refused to negotiate. We think the adverse market reaction immediately after the announcement of tariffs, or in other words, a severe push back from Mr. Market on the reciprocal tariff policy had the administration thinking about the policy even though they maintained their tough posturing. The recent turbulence in the bond markets after the 10-year yield jumped by ~+60 basis points within a few days (see figure 1) causing industry participants to speculate if any event of substantial stress in the fixed income markets is near. Further, increasing news flow of countries gravitating towards China had made it clear that the actions of the Trump administration could ‘Make China Strong Again’ rather than America. Figure 1: US 10-yr yield jumped up sharply after reciprocal tariffs announcement Source: Bloomberg We think the above factors contributed to an announcement of a pause on Trump’s tariff policy. However, since the tariffs are paused for 90-days and have not been rolled back; and a minimum of 10% tariff is still applicable, we think the case for inflation to increase in the future remains in place. Furthermore, tensions with China will stay elevated. The first-quarter earnings season could shed light on the impact of the uncertain environment on the earnings outlook and could again weigh on the sentiment. We think the case to keep a defensive tilt in portfolios is intact for now.   Vipul Arora is a Portfolio Manager with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact him at 613-258-1997 or visit ofarrellwealth.com  to discuss your particular circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. Insurance products and services are provided through Assante Estate and Insurance Services Inc.

We try to teach our kids to be resilient, to know right from wrong, to stand up for themselves, to be polite and to work hard. Some of us teach our kids about money and finances. How can we ensure that once they are on their own that they will have all the advice that they need to live independently and be financially responsible? I often get asked by clients if I can work with their children. Sometimes because the parents don’t have the knowledge, but more often because much of what kids need to know isn’t taught in schools today. Often, advice from a third party is generally better accepted by youth.  I enjoy collaborating with young clients. I have two children who are just starting out in life, and I see how important it is that they have a good financial foundation. There are many types of accounts today that historically did not exist, and each one has its own set of contribution and withdrawal rules. Navigating these accounts, along with the tax implications of these accounts, shows how vital financial advice is at all stages in life. Financial Advisors can give the right advice and help you plan to ensure your money is working effectively for you as a young person. Aside from the types of accounts and investments, here is a little advice I give all young people on what I call “Money Skills for Youth”. Save Regularly - getting into a habit of saving regularly early on in life will ensure that you have the things you want now, as well as later. Start a Budget – understand your cash flow – income and expenses. The Power of Compound Interest and the Rule of 72! If you start saving at 15 and you earn 8% you need to invest approximately $125 a month to have $1Million at age 65. 72 divided by the interest rate is the number of years it will take you to double your money. Debt – never borrow to buy what you cannot pay off or you cannot resell. Diversification - when you are getting started with investing understand your risk tolerance, time horizon, and choose a diversified portfolio to reduce risk. If you are young and looking for advice or have children getting started with a savings plan, reach out to your Financial Advisor who can help to produce the right plan. A good plan always starts with good advice.   Cynthia Batchelor is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact her at 613-935-6254 or visit ofarrellwealth.com to discuss your particular circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. Insurance products and services are provided through Assante Estate and Insurance Services Inc.

The North American capital markets witnessed a tumultuous month. Investor expectations switched back and forth between hopes of a de-escalation of the trade war threats to concerns of worsening global trade as the Trump administration continues to upend the United States’ relations with its global trade partners. The hopes of ‘Trump Put’, an expectation that the United States President will back-pedal on escalations to alleviate investors concerns in the event markets nosedive, have also faded. Most recently, Trump and several of his cabinet members have indicated that they are not looking at the stock markets. The US President in the joint address to Congress said that he expects some initial pain after the tariffs. Treasury Secretary, Scott Bessent, also stated in an interview that the United States economy will go through a ‘detox period’. In other words, the new administration seems prepared to go through pain to achieve its objectives. We believe the above statements exacerbated the already battered investor confidence and concerns gave way to despair, judging by the market price action for the past few days. From expectations of the United States economy to outperform the rest of the world on the back of business-friendly policies like lower taxes and deregulation, the outlook has changed dramatically to an economic deceleration or perhaps even an engineered recession in the United States. The back and forth on tariffs, upending of relationships with allies/friends, supporting the position of enemies in international arenas,  and job cuts of federal workers in the name of reducing wasteful expenditure, have all contributed to an environment of uncertainty in the United States and allied countries. The United States economic policy uncertainty index is now at levels last seen during the ‘Great Financial Crisis’ of 2008-2009 and the ‘Covid-19’ pandemic in 2020 (See Figure 1). As businesses postpone decision making during uncertain periods, the natural fallout is economic contraction, rise in unemployment and ultimately a recession if the uncertainty continues to linger. Figure 1: US Economic Policy Uncertainty Index Source: Bloomberg Judging from the recent comments of members of the Trump administration, we think the likelihood of uncertainty to linger longer has increased. The barrage of executive orders and attacks on mechanisms of potential check on Trump administrations’ actions suggests it could be a while before a meaningful opposition to the damaging actions can be staged, in our opinion. On the brighter side, the Federal Reserve’s chair, Jerome Powell, has not raised the investors hopes of monetary policy support yet. Any positive surprise on this front could help the market sentiment, in our view. In addition, the crisis created in Canada due to tariffs has now galvanized enough support to direct the nation’s energies towards self-sufficiency. While tariffs will be a negative for Canada, the developments have set things in motion for decisions that could serve the country better in the long run. Similarly, for the United States, the things are now set in motion that will reduce its importance and power on the global stage in the long run given its new image of being an unreliable partner. The western world is fractured right now and is scrambling to find alternatives to the global roles the United States has abandoned. The silver lining is that this necessitates a lot of capital expenditure towards critical minerals, defense, energy and technological sufficiency by these countries, which in turn implies new opportunities for investors. We think the near-term headwinds for the global markets have increased and thus warrant a tactical defensive tilt to the investment portfolios. Furthermore, diversification to global geographies and different asset classes is a must to mitigate the downside risk in this environment. Nevertheless, the investment environment can change quickly if the United States shifts its position towards damage control rather then pressing on with the damaging policies. Overall, our optimism on the outlook for 2025 is tempered, however, we think the second half of 2025 should be relatively better. This could either be due to capitulation of Trump administration (reversal of some of the policies) to adverse market reaction and/or stalling of its actions as opposition finally finds it footing and stages a push back.   Vipul Arora is a Portfolio Manager with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact him at 613-258-1997 or visit ofarrellwealth.com  to discuss your particular circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. Insurance products and services are provided through Assante Estate and Insurance Services Inc.

The worst news you could receive is that your child has fallen sick with a critical illness. Worry, fear, and concern come crashing down. Your world stops, but your bills and obligations do not.   It is very common, as a Financial Advisor, to encounter families who are unprepared for the financial strain and overall stress that can accompany a child’s critical illness. From unexpected expenses to taking extra time off work to be with your child. Children’s Critical Illness Insurance is a product designed to alleviate some of the pressure and provide peace of mind and financial stability during one of life’s most challenging moments.   What is Children’s Critical Illness (CI) insurance?   This type of insurance provides a lump-sum payment if your child is diagnosed with a covered critical illness, such as cancer, cystic fibrosis, or congenital heart disease. The funds can be used for medical expenses, travel for specialized care, or even to replace lost income if you need to take time off work. The funds can be used to assist you and your family during this time of need.   Critical Illness insurance is beneficial to parents, grandparents, and guardians who want to safeguard their family’s financial future in the event of a child receiving a diagnosis. It’s particularly beneficial for self-employed individuals or those without extensive paid leave, as it ensures financial stability while focusing on your child’s recovery.   Why choose Children’s CI coverage for your family?   1. Financial Security: The lump-sum payment can cover medical bills, therapy, or even household expenses, allowing you to focus entirely on your child’s well-being.   2. Affordable Premiums: Policies for children are often more affordable with premiums well within many families’ budgets, depending on the coverage and the child’s age.   3. Comprehensive Coverage: Many policies cover a wide range of illnesses, including those unique to children. Some policies can even be converted to adult policies in the future.   4. Peace of Mind: Knowing you have a financial safety net that can alleviate stress during a very difficult time.   Life is unpredictable, and a critical illness can be life altering for a family. By investing in a critical illness policy, you’re taking a proactive step to protect your family’s financial health. It’s not just about money—it’s about ensuring you can be there for your child without worrying about the financial implications.   If you would like to learn more about how Children’s Critical Illness Insurance can fit into your financial plan, please contact O’Farrell Wealth and Estate Planning. A Financial Advisor will be happy to discuss options tailored to your family’s needs. Let’s work together to secure your families peace of mind.   Andrew Goetz is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact him at 613-258-1997 or visit ofarrellwealth.com to discuss your particular circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. Insurance products and services are provided through Assante Estate and Insurance Services Inc.

The North American Markets witnessed a bumpy start to the year 2025. Nevertheless, the S&P 500 Index and S&P TSX Index advanced by about +2.7% and +3.3% for the month, respectively. Fixed Income markets also delivered positive returns with bond yields declining on both sides of the border. The Bank of Canada lowered its policy rates by +25 basis points to bring policy rates to +3.0% and the United States Federal Reserve decided to pause the rate cut cycle and held the rates at +4.5%. The bond yields on 2-to-10-year tenures were down by approximately 16-to-29 basis points in Canada while in the United States the decline was more modest at approximately 3-to-6 basis points. Despite the heightened uncertainty and choppy markets, the year 2025 has been off to a good start for investors. The incoming US President had well telegraphed intentions to implement tariffs on the imports from Canada, Mexico and China citing trade deficits; threats from illegal immigrants and drugs flowing into the country as a reason for concern. Investors anxiety was palpable before the inauguration ceremony on January 20th with speculations rife on which executive orders might get signed on the first day. However, the anxiety waned on the news that the President has chosen to ask federal agencies to investigate on the trade policies and report back by April 1st. This gave hope to investors that perhaps sensible choices will prevail and therefore measures might be less arduous than previously expected. This optimism proved short lived as towards the end of the month, the White House confirmed the intent to implement 25% tariffs on all imports from Canada and Mexico; 10% tariff on energy imports form Canada; and 10% additional tariffs on imports from China. The markets suffered another jolt during the month after a Chinese Artificial Intelligence start up company, DeepSeek, announced results of its AI models that produced better results than current LLMs (Large Language Models) and stated that the cost to train these models was at a fraction of a cost to train the current mainstream models. This raised the question whether the current spend on AI infrastructure is overdone. However, the market tremors due the start of tariff wars and advancements in Artificial Intelligence Technology in China also did not last long as tariffs on Canada and Mexico were put on hold for 30 days after the initial talks. Further, during the earnings calls of the big technology companies, forward looking guidance suggested the capital expenditure plans to scale up the Artificial Intelligence infrastructure have increased rather than decrease. We think uncertainty in the broader markets is likely to continue as news flow remains erratic around tariffs and trade war. Speculations around the end game of the Trump Administration to upend the existing international trade and relations will likely keep investors on the edge. While the greater border control as a desired outcome from Mexico and reducing the flow of Fentanyl precursors from China seem plausible reasons to play hardball; the same arguments appear weak with respect to Canada. Is the goal to just stem the flow of illegal immigrants and drugs or is it to put the negotiating parties on defensive before the negotiations of USMCA (erstwhile NAFTA) begin in 2026? Are the tariffs being implemented with an end goal of forcing the companies to manufacture more in the United States? Or is the end goal even more sinister such as weakening Canada to an extent that annexation by the United States appears to be a better choice? As of now, there are more questions than answers and the story continue to evolve with each passing day. That said, all or any of the above in any mix will have a varying degree of impact on the inflation and growth expectations and thus the capital markets. Trade wars are inflationary and uncertain outlook on inflation complicates the task for the Central Banks in 2025, in our opinion. The economic data has stayed strong with the Personal Consumption Index (Feds preferred measure of inflation) in line with expectations (+2.6% headline and +2.8% core for the month of December) and unemployment edging down to +4.0% in January from +4.1% in December in the United States. The headline inflation in Canada was also lower-than-expected at +1.8% in December (down from +1.9% in November) and unemployment dropped from +6.7% in December to +6.6% in January. We think the economic data and robust guidance from corporates continues to support the case for constructive outlook on markets. That said, erratic news flow around tariffs will keep the market price action choppy.   Source: Bloomberg Vipul Arora is a Portfolio Manager with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact him at 613-258-1997 or visit ofarrellwealth.com  to discuss your particular circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. Insurance products and services are provided through Assante Estate and Insurance Services Inc.

As we move into 2025, it’s essential to maintain focus on our financial goals. The beginning of a new year often brings a surge of motivation to improve our financial habits, but it can be challenging to remain committed. Whether you aim to pay off debt, save for a major purchase, or build long-term wealth, sticking with your financial goals requires strategic planning, discipline, and flexibility. Here are some effective strategies to help you stay on track and progress toward achieving your 2025 financial goals. 1. Set SMART Goals The first step to achieving your financial goals is to set clear, realistic objectives. Use the SMART goal framework — Specific, Measurable, Achievable, Relevant, and Time-bound when setting your goals. For example, instead of just saying, “I want to save more,” set a clear target: “I will save $5,000 for a down payment on a car by December 2025.” This approach helps you focus on a tangible goal, giving you a clear direction to follow. 2. Break Goals into Smaller Milestones Large financial goals can feel overwhelming, but breaking them down into smaller, manageable tasks can make them more achievable. For instance, if you want to save $5,000 by the end of the year, aim to save roughly $400 per month. By dividing your goal into smaller milestones, you can track your progress, celebrate small victories along the way, and stay motivated. 3. Automate Your Finances One of the most effective ways to stay on track with your financial goals, is automation. Set up automatic transfers to your savings and investment accounts, ensuring that a portion of your income is directed toward your goals without requiring active effort. By automating your savings, you reduce the temptation to spend money elsewhere and create a consistent path toward your financial goals. 4. Monitor Your Progress Regularly Reviewing your financial goals regularly is a crucial step to staying on track. Schedule quarterly check-ins to assess your progress and make adjustments, if necessary. If you're falling short of your savings targets or spending more than planned, use this time to identify areas for improvement. This review process helps you remain mindful of your financial objectives and allows you to course-correct before it's too late. 5. Stay Flexible and Adjust When Needed Life happens, and sometimes unexpected events can interfere with your financial goals. If you face a job loss, life event, medical emergency, or a financial setback, it’s important to be flexible. Adjust your goals to reflect your current situation, whether it means extending your timeline or modifying the amount of your goal. Flexibility ensures that you don’t become discouraged and helps you stay resilient in the face of challenges. 6. Build a Support System Staying committed to your financial goals can be challenging, but having a support system can make a significant difference. Whether it’s a financial advisor, a friend, or an online community; having people who can offer advice, encouragement, and accountability can help keep you motivated. Share your goals with someone you trust and ask them to check in on your progress. Their support can help you maintain momentum, especially during difficult times. 7. Avoid Lifestyle Inflation As your income grows, it’s tempting to increase spending on non-essential items. One of the biggest obstacles to achieving your financial goals is lifestyle inflation, spending more as you earn more. To stay on track with your 2025 goals, resist the urge to upgrade your lifestyle unnecessarily. Instead, channel any increase in income directly toward your savings or investment accounts. This disciplined approach allows you to accumulate wealth faster and stay focused on your financial goals.   In summary achieving your financial goals in 2025 is entirely within your reach, if you set clear, realistic objectives, remain disciplined, and adapt to life’s challenges. By setting SMART goals, breaking them into manageable milestones, automating your savings, and consistently monitoring your progress, you’ll position yourself for success. It’s also important to stay flexible, build a support system, and celebrate the small wins to maintain motivation. With these strategies, you’ll be well on your way to achieving your financial goals and setting yourself up for long-term financial success.   Cole Seabrook is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact him at 613-258-1997 or visit ofarrellwealth.com to discuss your particular circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. Insurance products and services are provided through Assante Estate and Insurance Services Inc.

“Bulls markets are born on pessimism, grow on scepticism, mature on optimism and die of euphoria” – Sir John Templeton After a stellar 2024, investors displayed some caution during the month of December, largely driven by the hawkish tone by the United States Federal Reserve during its meeting on December 18th, 2024. The committee delivered a 25 basis points cut, in line with market expectations, however it has dialed back on the expectations of policy easing during 2025. The Fed dots plot that shows the leaning of committee participants on a potential rate trajectory indicated that median policy rate in the United States, as at the end of 2025, is now projected to be 3.875%, up from 3.375% as projected in meeting during September (See Figure 1 and 2). In other words, the rate cut expectations were dialed back from four cuts to only two cuts during 2025. The fixed income asset class witnessed further losses as bond yields jumped higher on a more hawkish than anticipated tone of the Federal Reserve. Figure 1: Federal Open Market Committee Dots Plot 18th December 2024 Source: Bloomberg   Figure 2: Fed Dots Median Source: Bloomberg On this side of the border, the Bank of Canada delivered another jumbo cut of 50 basis points on 11 December and brought the policy rates to 3.25%. Increasing unemployment put together with benign inflation readings had placed the Bank of Canada in a comfortable position to ease monetary policy. The resilience of the United States economy, even in the face of high interest rates, backs the caution in the tone of the United States Federal Reserve on forward trajectory of policy rates. On the other hand, back-to-back jumbo rate cuts by the Bank of Canada were underpinned by the anemic growth in the Canadian economy. While Bank of Canada guided for a more measured approach to rate cuts going forward, the concern around the uncertainty caused by threat of 25% tariffs on good exported from Canada to the United States was palpable. We think the heightened caution resulted in the absence of a typical ‘Santa Claus rally’ during 2024. The Santa Claus rally refers to a seasonal advance in the North American markets during the sparsely traded last weeks of the year. Nevertheless, we think the silver lining of recent price action and market commentary is that the market sentiment can no longer be classified as euphoric, i.e., if one were to heed to the wise words of “Sir John Templeton”, the case of bull markets being over is not strong yet. We think the that markets in 2025 are set up to face several crosscurrents and investors are taking a notice. We note a few of the most importance as below The rising bond yields even in face of the lower interest rates implies bonds markets’ concerns on potential resurgence of inflation continue to linger, therefore, Central Banks can not put this issue to bed yet. The potential for increase in geopolitical tensions is high given the recent posturing of the incoming Trump administration on political issues around the globe. Trade and tariffs are going to be the weapon of choice for aggression and retaliation, which bring direct but idiosyncratic risks to the capital markets.   The risk of a recession remains low; and policy rate trajectory continues to be favorable, though at a slower pace. Lower regulations and business friendly policies from the new administration in the United States are likely to support markets. As per Bloomberg data, the index level headline earnings growth expectations for the S&P 500 Index and S&P TSX Index are in the range in low-to-mid double digits. As long as the expected earnings growth remains robust, the case for constructive outlook on markets remains strong, in our opinion. Overall, we think the ebb and flow of developments around the above topics will determine the direction of the markets. Layering on high valuation and healthy corporate profits, we think a choppy but still a net positive price action could be the theme for North American markets this year.

The S&P 500 Index and the S&P TSX Index both registered healthy gains during the month of November as the North American equity markets celebrated the results of the United States Presidential Elections.  Equity Investors viewed the expectations of continuing tax breaks from 2017 and less onerous regulations as a positive.  The fixed income asset class was also green on both sides of the border; however, we think this was largely driven by investors dialing back expectations of higher inflation due to trade wars. The Cabinet announcements by the President-Elect, Donald Trump, were keenly analyzed by investors. The announcement of ‘Scott Bessent’ being picked as a Treasury Secretary, who has been known to have a moderate and prudent voice about tariffs, brought some relief to fixed income investors after a tough October. Higher tariffs will increase the cost of imports and, therefore, are inflationary.   The uncertainty around the policy rate trajectory has increased again with a higher potential of trade wars and its inflationary impact. Although the details on tariffs are still missing, initial volleys have been fired. China has prohibited exports of Gallium, Germanium, and Antimony to the United States in response to the USA's latest ban on export of advanced memory chips and chip-making tools to China. These banned materials are used in applications across semiconductors, solar cells, and military. The fixed income markets have reacted adversely to the developments given the impact of tariffs on inflation and the rate trajectory. Equity markets, however, are still to discount this development, in our view. The United States accounts for nearly two-thirds of Canada’s trade and therefore tariffs will have a substantial impact on the Canadian economy. Whether tariffs are implemented or not remains to be seen, however, it is certain that the rhetoric on trade will increase with the incoming United States administration. We think it will bring idiosyncratic volatility to the North American equity markets. Notwithstanding some concerns, the macro environment has continued to remain mostly favorable for the markets so far, in our view. The headline inflation has been benign for Canada and the United States (see Figure 1). The unemployment rate in Canada has continued to increase; while the unemployment rate in the United States has remained low by historical standards (see figure 2). Given the increase in unemployment numbers in Canada, industry participants are expecting a 50 basis points cut in policy rates after the upcoming Bank of Canada meeting on the 11th of December. In the United States, the expectations are more muted at 25 basis-points cut on the 18th of December. Figure 1: Headline inflation remains benign in Canada and the United States Source: Bloomberg Figure 2: Unemployment has been rising in Canada Source: Bloomberg Looking ahead, we think some market jitters can be expected due to the tariff talks and the potential escalation in geopolitical tensions. However, as long as macro environment remains favourable with robust economic data and accommodative Central Banks policies; the markets should overcome any short-term jitters and extend the current bull run. We wish our readers very Happy Holidays.

The holiday season is upon us! We are quickly approaching one of the busiest times of the year and it can be so easy to get wrapped up in its comings and goings. We partake in family traditions like Christmas gatherings, decorating the tree, or perhaps for your family it means watching “The Grinch” together every year.   We tend to focus on those closest to us – family, friends, and/or colleagues. But perhaps there are takeaways we could draw on from The Grinch. We must not forget to show kindness to not only those around us, but to strangers as well, just as Cindy Lou Who demonstrated to The Grinch. There are many who no longer have family with them to celebrate with and some may be less fortunate. A small gesture can go a long way to help everyone in our community have a wonderful holiday season. Several community organizations host social gatherings or Christmas meals for everyone to enjoy. This is an easy and meaningful way for our community to come together, enjoy each other’s company, and make new friends in what can be a difficult time for many.   You could also consider donations to local organizations or charities, like food banks or service clubs that help those who may have fallen on hard times. Donations do not always have to be monetary; often organizations struggle to find enough volunteers during these busy times. Your time is often just as valuable as financial assistance. It is also a good way for those who want to help but may not necessarily be able to financially.   We are lucky to live in a community that takes care of each other. We can continue to care for and support each other by buying from local businesses. We are fortunate to have such a wide array of small businesses in our area, so take the time to go out and see what they can offer you and your loved ones this holiday season.   So, in the words of Dr. Seuss “What if Christmas, he thought, doesn’t come from a store. What is Christmas…perhaps…Christmas means a little bit more!”.   We wish you all a very happy holiday season and a healthy and prosperous new year!     Allison Martin is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact her at 613-774-2456 or visit ofarrellwealth.com to discuss your particular circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. Insurance products and services are provided through Assante Estate and Insurance Services Inc.

In our previous update, we highlighted the investors dilemma of whether there could be two or three rates cuts before the year-end. The month of October tilted the debate in favor of only two rate cuts with one 25 basis-points cut already delivered by the United States Federal Reserve on the 7th of November. The Bank of Canada’s rate decision was announced on October 23rd , and it delivered a 50 basis-points cut in line with expectations. Despite the announced policy rate cuts which are positive for the fixed income asset class; the bond investors were in red for the month on both sides of the border. The yield curves in Canada and the United States shifted upwards as investors dialed back expectations of the number of rate cuts and baked in a slower path to inflation normalization. (See Figure 1 and 2) Figure 1: Canada Sovereign Curve Source: Bloomberg Figure 2: US Treasury Actives Curve Source: Bloomberg   The United States presidential elections were top of mind of investors across the globe given the difference between policies announced by the Republican and Democrat candidates. Trump presidency was being viewed by markets as relatively more inflationary as telegraphed intentions of tariffs on imports put together with promises of tax rate cuts translated into simultaneous increases in supply bottlenecks and a stimulus that could increase demand. Though the exit polls were showing a close contest; the financial markets traded on expectations of a Republican win as evident from the rise in bond yields, in our view. In addition, better-than-expected economic data also corroborated to support the move in bond yields. In Canada, the headline inflation dropped to +1.6% in September (reported in October) from +2.0% in August (reported in September). This was below the expected number of +1.8% for September. In the United States, the headline inflation was at +2.4% for September (reported in October); lower than +2.5% in August (reported in September), but higher than expected +2.3%. The unemployment rate in Canada dropped to +6.5% in September (reported in October) from +6.6% in August (reported in September). In the United States, the unemployment rate dropped to +4.1% in September (reported in October) from +4.2% in August (reported in September). ISM Manufacturing PMI (Purchasing Manager’s Index) in the United States was flat at +47.2 in September (reported in October), however, ISM Services PMI jumped to +54.9 in September (reported in October) from +51.5 in August (reported in September). We expect the volatility in bond yields to remain elevated as investors dissect every datapoint with a read through on inflation or policy rates trajectory. The tensions between the Federal Reserve Chair, Jerome Powell, and President-Elect, Donald Trump, have been well known. During the press briefing after the latest FOMC (Federal Open Market Committee) meeting, the United States Fed chair, Jerome Powell, replied with a brief ‘No’ to a question that asked if he would resign should the new President ask him to do so. While we think it is unlikely the President-Elect, Donald Trump, would like to disrupt the Federal Reserve and undermine the progress made on inflation so far, any rhetoric on this front could bring short-term volatility to the broader markets, in our opinion. Resilient economic data put together with supportive central bank policies and benign inflationary pressures for now keep us constructive on the outlook. We think this backdrop continues to make a strong case for investment in risk assets despite stretched valuations.

Each year the Financial Consumer Agency of Canada (FCAC) dedicates the month of November as Financial Literacy Month. The campaign for 2024 is being promoted as “Money on your Mind. Talk about it.”   Financial Literacy is a forever moving target. Some people are just beginning their journey, while others are bordering on expertise. Either way, you can always learn more about finances. The 2024 campaign is focused on reducing the taboo surrounding speaking openly about money. Stop just thinking about money and start talking about it. Talking with friends, family, and a Financial Advisor will not only help you build knowledge and open you up to ideas and solutions, but it can maybe even help you educate your own kids along the way.   Is Inflation on your mind?  The Canadian inflation rate has finally dropped below the coveted 2% and is currently sitting at 1.6%. But this doesn’t mean prices are dropping, this just means the rate of price increases have slowed. If inflation is eating into your finances – or if you just want to learn more about inflation – try talking about it.   A good friend could give you tips and tricks on how to reduce the impact of inflation on your grocery bill. Tips like which stores have the best prices on different products or what day the produce is the freshest to help reduce your food waste. Perhaps if you ask, they would even be willing to share that secret family recipe so you can make the perfect dish at home rather than buying a frozen pre-packaged version.   A work colleague might encourage you to consider asking for a raise or promotion. Have you developed in your role and met or exceeded all your targets? Sitting with your employer and presenting how you have supported the business and asking for an increase may provide fruitful results. Having this discussion can also get your employer thinking more about what their employees need and may generate wage increases or additional benefits for the Team.   A Financial Advisor would happily discuss and explain which inflation metrics they are using in their financial planning software. You can look at your retirement plan together and discuss how inflation impacts your spending in retirement. Are your investments generating enough return to provide an ample after inflation rate of return? Are you contributing enough to your investment accounts to meet your goals?   Maybe its not inflation on your mind. Maybe you are thinking about all the different types of investment accounts, stock market returns, interest rates or how to build a budget.   This November take the time to talk about money. Take the opportunity to learn from friends, family, colleagues and professionals. By sharing some of your concerns you may find that others have similar concerns. It’s important to talk openly and find the solutions together.   If you have any questions about Financial Literacy, reach out to a Financial Advisor at O’Farrell Wealth & Estate Planning. Every question is worth a conversation. Book a complimentary meeting today.   Sources: https://www.canada.ca/en/financial-consumer-agency/campaigns/financial-literacy-month.html https://safa.ontariotechu.ca/resources/financial-literacy-month-november.php https://www.canada.ca/en/financial-consumer-agency/services/teaching-children-money.html   Sarah Chisholm is a Financial Advisor with Assante Capital Management Ltd. The opinions expressed are those of the author and not necessarily those of Assante Capital Management Ltd. Please contact her at 613-258-1997 or visit ofarrellwealth.com to discuss your particular circumstances prior to acting on the information above. Assante Capital Management Ltd. is a member of the Canadian Investor Protection Fund and the Canadian Investment Regulatory Organization. Insurance products and services are provided through Assante Estate and Insurance Services Inc.

The month of September witnessed heightened volatility early in the first week after lower-than-expected prints of economic data fueled the narrative that the economy might be running out of steam faster than previously expected and the US Federal Reserve is behind the curve. The expectations for non-farm payrolls data for August (reported in September) were at an addition of ~162.83k jobs; instead, the reported number was weaker at ~142k jobs. The Institute of Supply Management’s (ISM) Manufacturing Purchasing Manager’s Index (PMI), a gauge of manufacturing activity, was also lower-than-expected at +47.2 (expected +47.6). However, ISM Services PMI was marginally higher at +51.5 (expected +51.3). Weaker economic data on top of a revised labor market report from Bureau of Labor Statistics (BLS) in late August that showed that economy had added much lower jobs than previously reported between April 2023 to March 2024, exacerbated concerns around the increased likelihood of a potential recession. Consequently, the fixed-income investors baked in expectations of a 50 basis-points cut from the United States Federal Reserve for the Federal Open Market Committee (FOMC) meeting on 18th September. The United States Federal Reserve Chair, Jerome Powell, had been emphasizing for some time that the health of labor market health now weighs more over the inflation in the committee’s decision as inflation has become less of a concern in the previous few months. Keeping true to the Fed chair’s message of “we do not seek or welcome further cooling of labor market conditions” during a speech in the late August, the United States Federal Reserve did not disappoint the investors and delivered a 50 basis-points rate cut to start the policy rate cut cycle on 18th September. However, the committee appeared divided on the remaining number of cuts needed (two or three) through the end of year 2024 (See Figure 1). Each dot shows the expectation of a Fed policy maker for the rates at the end of respective year. Supportive comments and action from the central bank authorities; benign inflation data; better-than expected retail sales put together with no further alarms from the interim jobs data reported through the month (jobless claims); helped the North American markets more than recover from the initial setback and both the equity and fixed income asset classes ended the month on a positive note. Figure 1: Federal Open Market Committee Dots Plot 18th September 2024 Source: Bloomberg The balance of reported economic data has continued to be positive in the early October so far; but stronger-than-expected labor market data has forced the investors to dial back expectations of rate cuts in the United States. The change in non-farm payrolls for September (reported in October) was at +254k, much higher than expected +145.5k. As of this writing, the fixed income investors have reduced expectations to two policy rate cuts from the US Federal Reserve through the year-end 2024 from three rate cuts around the meeting date in September 2024 (See figure 2). While the bond yields in Canada have moved in sympathy with the yields in the United states; in contrast, the chatter amongst the industry participants of a jumbo rate cut (50 basis points) has increased as Canada’s headline inflation is down to +2.0% in August (reported in September) from +2.5% in July (reported in August) and unemployment rate has ticked up to +6.6% in August (reported in September) from +6.4% in July (reported in August). The Bank of Canada meets on 23rd October to decide on the next policy move. Figure 2: Estimated Number of Moves Priced in for the US - Futures Model December 2024 meeting   Source: Bloomberg Looking ahead, we note that geopolitical tensions have increased and election uncertainty in the United States could be a source of short-term volatility in the markets. In addition, the ebb and flow of economic data could also continue to shift investors positioning between expectations of two or three cuts through the year-end and bring some near-term volatility. However, the balance of economic data and supportive stance from the central banks continues to favor an overall constructive outlook on the markets, in our view.