Between US tariff wars, Greenland making headlines and political turmoil in Venezuela, 2025 and early 2026 have delivered more than their fair share of geopolitical drama.
If you’ve checked your super balance or investment portfolio lately and felt a flicker of concern, that’s completely understandable. Markets do not like uncertainty. Before making any reactive decisions, though, it helps to unpack what is actually happening and how it fits into your long-term financial plan.
Trump’s tariffs
The biggest story shaking global markets right now is the US tariff changes, and it’s showing no sign of a clean resolution.
Shortly after taking office in January 2025, the Trump administration imposed sweeping tariffs on imports from dozens of countries. In April 2025, the US announced “reciprocal” tariffs on nearly all trading partners, triggering a sharp market sell-off.
Then, on 20 February 2026, the US Supreme Court ruled that the legal basis used to impose many of these tariffs (the International Emergency Economic Powers Act) does not actually authorise the president to levy tariffs.
Reacting to the court’s ruling, the US president initially announced a new temporary global tariff of 10%, but later said he would increase that level to 15%. To confuse markets further, collection of the new tariff began at midnight on Tuesday, 24 February, but at the 10% rate he had first announced. The government has not said why they are using the lower tariff. A high-level official told the Financial Times that the 15% would come later, but this has not been confirmed.
In short, this story is far from over.
While Australia had previously negotiated specific trade terms, the 10% blanket tariff and the threat of a global 15% rate create a challenge for exporters and can raise concerns for investors. When trade barriers go up, the cost of doing business rises, which can fuel inflation – a key concern for the Reserve Bank of Australia (RBA) as we move further into 2026.
There are also more indirect consequences. When the world’s largest economy disrupts global supply chains, the ripple effects show up in commodity prices, currency movements, inflation expectations and the earnings of companies held in diversified portfolios. For instance, after the introduction of tariffs in April 2025, the S&P 500 fell around 15%. But, as the graph shows, it later recovered to be up nearly 10% from the start of the year by mid-2025 – a reminder of how quickly conditions can swing in either direction.
Greenland
There are several other geopolitical events that have also had an impact on the markets in the last few months.
Greenland’s location between North America and Europe makes it critical for Arctic shipping routes. As polar ice melts, new trade passages are becoming more viable. Greenland is also believed to have significant mineral deposits and hydrocarbon potential, including rare earth elements used in technology and defence.
The United States, China and Russia all have competing interests in the Arctic region. And when large powers compete for influence, markets pay attention. Even if tensions do not escalate into open conflict, the risk of regional instability can shift global risk sentiment, and that sentiment feeds directly into how investors price assets worldwide.
When investors sense rising geopolitical tension, they often move capital into perceived ‘safe haven’ assets such as government bonds or gold. Equity markets, particularly in regions seen as exposed, can experience short-term volatility.
Venezuela
Venezuela is a good example of how quickly politics can spill into markets.
Venezuela sits on the world’s largest proven oil reserves and is a significant supplier to global energy markets. Internal political turmoil and ongoing legal actions against the Venezuelan leadership (compounded by the ‘arresting’ of President Maduro by the US in January) have created significant uncertainty around oil production and pricing.
Oil is a fundamental input for virtually every economy in the world. It affects manufacturing costs, transport, food production and a wide range of consumer goods. When supply becomes uncertain, energy stocks, commodities and inflation expectations all move accordingly.
This matters for your financial planning. Rising energy costs can quietly erode purchasing power and put pressure on lifestyle budgets, which is why staying on top of these global dynamics matters, even if you never plan to invest in an oil company directly.
How geopolitical events move markets
It helps to understand what’s actually going on under the headlines.
Short-term swings
Sudden news or policy announcements can trigger rapid moves in equities, commodities and currencies.
Take the oil price, for example. As the graph below from oilprices.com shows, prices dropped suddenly and drastically in mid-December as tensions began to escalate between the US and Venezuela. They declined again in early January after the military action that saw President Maduro taken to the US. But they have since recovered.
These are often emotional reactions, driven more by fear than by fundamental changes in the value of businesses.
Investor sentiment
Uncertainty amplifies market reactions. When investors don’t know what’s coming next, many move to safer assets or reduce their exposure altogether, which can create a cycle of selling and falling prices.
Sector impacts
Not all industries are equally affected. Energy, defence, technology and critical minerals tend to be more directly exposed to geopolitical developments. Gold often moves in the opposite direction – investors tend to flock to it as a safe haven when uncertainty spikes, which is why it’s been a strong performer in recent months. A well-diversified portfolio can help reduce the impact of any one sector being hit hard.
Global interconnection
As demonstrated by the impact of tariffs around the world, events in one region tend to ripple through international trade flows, supply chains and cross-border investment returns. A tariff dispute between the US and China, for instance, affects Australian exporters, multinational company earnings and emerging market currencies all at once.
What this means for you
Geopolitical tension is not new. Markets have navigated wars, trade disputes, elections and political crises for decades.
Nobody predicted the tariff chaos of April 2025. The question is whether your financial planning strategy was built for a world where surprises happen, because they always do. That means:
⦁ An asset allocation suited to your life stage
⦁ Sensible diversification across sectors and regions
⦁ Enough liquidity to avoid being forced into poor timing decisions
⦁ The discipline to stay the course
Whether you’re building wealth in Surfers Paradise, making the most of your final working years in Hope Island or enjoying retirement in Burleigh Heads, those fundamentals do not change.
Working with a Gold Coast financial adviser can help you step back from the headlines and assess whether your investments, cash reserves and risk settings are still appropriate. At RFS Advice, our highly educated financial advisers focus on portfolios designed for resilience. Effective retirement planning is not about forecasting every geopolitical shift, but about structure, discipline and regular review.
If you would like to review your strategy in light of current global events, speak with an RFS Advice financial adviser today.
Frequently asked questions
Australia is very integrated into the global economy. Our major companies have international operations and supply chains, our commodity exports are priced in global markets and our managed funds hold international assets. When US trade policy disrupts global trade and markets, those effects flow through to Australian portfolios.
Not always. Tariffs can create short-term volatility and affect certain industries more than others. However, broader market performance depends on economic growth, earnings, interest rates and investor sentiment.
Certain asset classes – such as government bonds, gold and infrastructure – can be more defensive during periods of geopolitical uncertainty, though no investment is entirely immune. A well-constructed, diversified portfolio typically balances growth assets with more defensive holdings, which can help smooth out volatility over time.
Rarely. Geopolitical events often cause short-term noise. A robust financial planning strategy is built to weather these cycles. It is usually better to review your risk tolerance with your Gold Coast financial adviser rather than making emotional decisions based on the news.
General advice warning:
The information and any advice provided in this article has been prepared without taking into account your objectives, financial situation or needs. Because of that, you should, before acting on the advice, consider the appropriateness of the advice, having regard to those things.
