What 2025 really signals for investors in 2026
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According to Fiera’s Jean-Guy Desjardins, the year’s mild indicators overshadowed a deeper geopolitical reset and Canada’s emerging economic pivot
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THE PAST YEAR has been marked by a striking disconnect. Economically, 2025 did not deliver the kind of systemwide shock that defined the downturns of the 1970s, 2008, or the early months of the pandemic. Yet, at the geopolitical level, the world has rarely felt more unsettled. That contrast shaped investor sentiment throughout the year and continues to influence how market leaders are framing the outlook for 2026.
Jean-Guy Desjardins, founder and board chair of Fiera Capital, has spent more than five decades studying the intersection of macroeconomics, policy, and markets. In a November 2025 interview, Desjardins’ assessment is straightforward. Economic conditions in 2025 were challenging but not severe. Geopolitical conditions, however, were more unpredictable and more consequential than at any time in his career. His observations, rooted in the perspective of someone who has seen multiple cycles, help explain why the headline numbers of 2025 feel calmer than the undercurrents that defined them.
Fiera Capital Corporation (“Fiera Capital” or the “Company”) is a leading independent asset management firm with a growing global presence and $166.9 billion in AUM as of September 30, 2025. The Company delivers customized and multi-asset solutions across public and private market asset classes to institutional, financial intermediaries and private wealth clients across Canada, United States, Europe, Middle East, Africa (“EMEA”) and key markets in Asia.
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“We are facing the
build-up of three or four major military powers, where previously we used to deal with two. That makes the system far more fragile”
Jean-Guy Desjardins, Fiera Capital
Compared with previous downturns, the economic backdrop of 2025 looked relatively subdued. Desjardins notes that the inflation crisis of the 1970s, the financial collapse of 2008, and the abrupt shutdowns of 2020 all carried a scale of economic impact that far exceeded today’s environment. In his words, “this one does not have the magnitude” of those earlier cycles. Activity slowed and inflation eased, but households and businesses were not confronted with the level of disruption seen in past recessions.
At first glance, investors might breathe a sigh of relief. But Desjardins warns that such a reading misses the bigger story. He argues that what distinguishes this moment is not an economic collapse but a geopolitical realignment. As Desjardins says, “We are facing the build-up of three or four major military powers, where previously we used to deal with two.” That, he says, “makes the system far more fragile.”
Where past downturns tended to be driven by internal economic imbalances corrected by monetary policy, this moment feels different. Today’s risk comes from outside the financial system: power shifts, alignment of military blocs, trade disruptions, and uncertainty over global leadership. For markets and investors, that kind of uncertainty is harder to model and far harder to price in.
As a result, 2025 lived somewhere between stability and volatility. Liquidity stayed sufficient to support elevated asset valuations. Credit markets functioned reasonably. But confidence rarely felt stable. Instead, the world felt like a waiting room where investors sought clarity on trade, alliances, and geopolitical direction.
Canada’s pivot: from consumption to investment, and from dependency to diversification
For Canada, the stakes of that uncertain world have become more apparent and more urgent. Domestic economic conditions in 2025 looked relatively decent. Inflation moderated faster than in many peer economies, and interest rates remained more restrictive than in much of the developed world. On paper, Canada seemed to be “ahead of the crowd,” as Desjardins puts it, in terms of both inflation control and monetary stance.
Yet he argues that underlying structural weaknesses remain. For decades, Canada’s economy relied heavily on government-funded consumption: social programs, transfers, and broad consumption supports. That approach helped smooth living standards and support social objectives. But it did little to build a resilient capital base. “Every one of those decisions is a form of consumption,” Desjardins observes. “You spend money and you do not build a capital base.”
Now, Canada must shift gears. Over the next two to three years, the country is likely to move from consumption-driven fiscal policy toward investment-driven economic strategy, in hopes of building a stronger foundation for future growth. Desjardins believes such a shift will require a period of slow growth or even stagnation: “The economy will be making a dramatic shift,” he says, “and we could stagnate … between plus 0.5 and minus 0.5.”
That pivot will not be painless or immediate. But 2025 already saw cracks in what was once a stable model. Canada’s long-running dependence on a single export partner, the United States, exposed a major vulnerability. Roughly three quarters of Canadian exports go to the US. Desjardins draws an analogy: a business earning 75 percent of revenue from one client is stable until that client changes terms. That reality, coupled with shifting US trade policy, forced a reckoning in 2025.
The result: an unexpected degree of national alignment. Provinces that had long resisted interprovincial trade reforms began to relent. Internal barriers to trade such as regulatory hurdles, logistical friction, and provincial parochialism started to break down under pressure. The federal government moved quickly to ease internal trade restrictions that had stalled for years. That alone could add a meaningful percentage to national GDP over time, according to Desjardins.
Furthermore, Canada appears to be recalibrating how it engages with global markets. Instead of treating trade as export-heavy and US-centric, the country is beginning to reposition toward diversification. This means new trading partners, broader export strategies, and more resilient supply chains. Over time, these changes could reduce vulnerability to foreign policy shifts and strengthen long-term economic stability.
If managed properly, this structural realignment could reshape the Canadian economy. For investors both domestic and international, the payoff might come not from immediate growth but from lower systemic risk, wider diversification, and a more robust economic base.
Navigating transition with diversified conviction
Fiera Capital enters 2026 uniquely positioned for this kind of transition. The firm is able to deliver tailored portfolios through both single- and multi-asset strategies, covering both public and private markets.
This broad platform matters at a time when uncertainty is high and outcomes are difficult to forecast. In public markets, valuations are elevated and the risk of a correction looms if liquidity tightens. Desjardins has warned of a stock market bubble.
Private markets told a different story in 2025. While headlines pointed to slowing capital flows into private equity and private credit, Desjardins stresses that the apparent slowdown is relative to the extraordinary surge of the previous five years. Significant institutional capital remains committed to private strategies, and he sees real value in areas such as agriculture, timber, real estate, and infrastructure. These segments, in his view, offer more attractive risk−reward characteristics than broad public equity markets at this point in the cycle.
Fixed income also re-entered the conversation. With inflation cooling and yields still elevated, bonds regained relevance for the first time in several years. For long-horizon investors, fixed income and private markets may provide more durable foundations for portfolio construction in the near term.
In this environment, investors may benefit from a balanced, multi-asset approach, combining public equities, fixed income, and private markets rather than placing all their bets in one bucket. As the country pivots from consumption to investment and realigns trade and economic policy, Fiera’s diversified toolbox provides a way to participate in long-term structural shift.
“The economy will be making a dramatic shift and we could stagnate … between plus 0.5 and minus 0.5”
2026: a year of structural transition and selective opportunity
As Canada and global markets move into 2026, the key theme will be adaptation. The economic environment is unlikely to return to business-as-usual. Instead, structural shifts underway within Canada’s fiscal model, its trade relationships, and global supply-chain alignment will shape growth, investment, and risk.
Desjardins maintains a balanced outlook for 2026. He is optimistic about Canada’s internal alignment and the long-term benefits of shifting toward investment-focused economic policy. He believes this strategy can generate stronger foundations for future wealth creation. At the same time, he remains cautious about external risks. Canada does not control the direction of US politics, and it has no influence over global conflicts or rising military tensions. These uncertainties will continue to shape markets in ways that are difficult to predict.
In that sense, 2026 may not be a year of flashy returns. But it could be the beginning of a more resilient, more diversified, and ultimately more sustainable period in both Canada’s economy and global markets. What happens over the next few years may matter for decades to come.
attention to because we consider our data to be very important and not to be compromised,” she says. “We’re also going to be challenged as the nonprofit sector continues to grow. We see that the [commercial] insurance industry has generally been inconsistent in its willingness to provide the sort of coverage that nonprofits need and at the price that they can afford. So, I think our challenge is going to be to be there for the groups of nonprofits that will lead us to take up the coverage when others might fail them.”
To that end, NIA has made a concerted effort to reach out to brokers to help them determine the right coverage for their nonprofit clients.
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A year of modest economic pressure and unusual geopolitical strain
Published January 26, 2026
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“For decades, Canada’s economy relied heavily on government-funded consumption: social programs, transfers, and broad consumption supports. That approach helped smooth living standards and support social objectives. But it did little to build a resilient capital base.”
Jean-Guy Desjardins
Jean-Guy Desjardins
“Significant institutional capital remains committed to private strategies, and there is real value in areas such as agriculture, timber, real estate, and infrastructure. These segments offer more attractive risk−reward characteristics than broad public equity markets at this point in the cycle.”
Jean-Guy Desjardins, Fiera Capital
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Copyright © 1996-2026 KM Business Information Canada Ltd
Subscribe
Contact Us
External Contributors
Authors
About
SRI/ESG Directory
Money Managers Directory
Manager of U.S. Assets Directory
Legal Directory
Group Retirement Directory
Group Benefits Directory
Fixed Income Directory
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Consultant Directory
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Directories
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Premium Content
Events
E-Magazine
BPM Talk
Best in Pensions and Benefits
Resources
Mutual Funds
Fixed Income
ESG Investing
ETFs
Emerging Markets
Alternative Investments
Investments
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Defined Contribution
Defined Benefit
Pensions
Wellbeing
Pharma
Mental Health
HR
Group Health
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Benefits
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Authors
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Copyright © 1996-2026 KM Business Information Canada Ltd.