The first month of 2026 has been a masterclass in market adaptation, as the initial optimism of the new year met a series of significant economic "reality checks." While the ASX 200 and S&P 500 both reached historic peaks, they finished the month with late-session pullbacks as global investors pivoted away from pure growth toward the resilience of hard assets. Domestically, a surprising rebound in headline inflation to 3.8% and a remarkably tight labour market have shifted the conversation from potential rate cuts to a decisive 3.85% cash rate hike by the RBA. The Australian property market remains remarkably defiant, recording a 0.8% increase in values in January as a chronic shortage of supply continues to act as a floor for prices.
