For politics enthusiasts, 2024 was a banner year. In India, Narendra Modi received a reality check to his apparently unassailable grip on power. In South Africa, the ruling ANC’s humiliating showing forced the party to enter a coalition government. Mexico’s selection of Claudia Sheinbaum was seen by many as an endorsement of her predecessor’s populist policies. In the UK, Labour swept away a decade and a half of Tory dominance. France’s legislative election produced more questions than answers. And in the USA … well, we all know what happened there.
Each of these elections is pivotal because they promise to introduce significant political and economics shifts, and in unpredictable ways. Heightened volatility is one key legacy of the global election cycle of 2024.
Ongoing uncertainty
Will South Africa’s coalition government take a more fiscally conservative turn? Can Sheinbaum balance populism with prudence? How will Macron retain political credibility? Is Labour able to deliver the change it has promised without spooking the markets? As for Donald Trump, volatility is his middle name.
These are real dilemmas. It’s not just that we can’t reliably predict policy, but that policymakers themselves are faced with increasingly tough decisions that will have unpredictable consequences. Consider, for example, how much fire Rachel Reeves has taken for a budget that might have been expected to be substantially more radical.
The biggest unknown remains the Trump administration. Will Trump implement across-the-board tariffs, or is he simply using the threat of tariffs as an economic negotiating tactic? And would these hurt or ultimately benefit the rest of the world?
Elections are often volatile events. In some cases – frequently, in our current moment – they usher in periods of ongoing uncertainty.
Proactive risk management
The broader mood of uncertainty helps explain Finalto’s approach to risk. In the run up to the 2024 US election, Finalto implemented a proactive risk strategy to ensure there would always be sufficient liquidity to meet clients’ needs and to be able to effectively support and advise clients on how to navigate uncertainty.
As Finalto Chief Risk Officer Daniel Frostick explained at the time, the company takes a ‘business as usual approach’ to risk management, continually working to be prepared for unexpected events, and to respond effectively. “We spend a lot of time and effort to make sure we are always ready for unusual events,” Frostick said.
The integrated strategy also involves deploying the appropriate technology. Finalto’s powerful automation tools makes monitoring and responding to risk more seamless and effective.
The world’s markets, all under your control
In uncertain times, a trusted and experience liquidity partner is more important than ever.
Our commitment to supporting our clients is just one reason Finalto is consistently awarded for our liquidity solution. To find out how we can support your business, get in touch and discover the power of partnership.
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