Michael Ayres

As we head into April, global markets are navigating a highly complex matrix of geopolitical fragmentation and the potential for accelerating and persistent inflation. We are transitioning from a period where markets reacted primarily to political and central bank rhetoric to one where tangible supply chain disruptions and geopolitical friction are in the driver’s seat.

For the broader market, this means volatility is no longer a temporary spike, but a baseline condition that businesses and investors must integrate into their strategies. The prospect of oil testing the $200 mark in a worst-case supply shock scenario is no longer just a thought experiment. A shock of that magnitude would act as a severe regressive tax on the global economy. For investor confidence in the MENA region, the lack of capital inflows as the Strait of Hormuz is closed could lead to secondary effects like lack of liquidity and financial system stress.

During periods of extreme commodities volatility, relying solely on legacy correlation models can be dangerous, and the traditional 60/40 portfolio faces limitations. Alternative investments, from digital assets to derivative strategies, are being utilised as essential tools for decoupling from highly correlated traditional markets. To anticipate shifts, businesses and investors need to look past headline equity indices. Fixed income volatility, credit spreads, and cross-border trade flow data offer clearer signals. Watching liquidity metrics and the cost of capital provides early warnings. True resilience isn’t about predicting events, it’s about building the infrastructure to withstand them. Preparation means ensuring access to liquidity and utilising agile multi-asset technology.