Monthly report – December 2024
Reporting — January 2025
Monthly fund update
Key points
- A shift in monetary policy expectations (slower pace of rate cuts) resulted in a sharp increase in bond yields and a broad-based selloff in global equities.
- Our ongoing research indicates that the US has increasing demand for electricity for the first time in 20 years driven by data centres.
- We have a very optimistic outlook for electricity demand and all electricity generation technologies, their supply chains and associated infrastructure.
- We upgraded our outlook for electricity demand growth following Trump’s election victory (on the basis that anticipated cuts to regulation will result in data centres being built more quickly).
- Falling interest rates (100 basis points of cuts so far) are yet to have a material impact on our focus area of the electric energy sector and its supply chains (which have historically displayed very high sensitivity to interest rates). We believe that this lag is explained by uncertainty following the US election and will prove temporary.