Weekly Geopolitical Report – El Niño Update (September 28, 2015)

by Kaisa Stucke, CFA

Meteorologists have been calling for an El Niño event since last year.  Current forecasts place the likelihood of an El Niño occurrence this winter at over 90%.  Now, talk has turned from the likelihood of an El Niño to whether the abnormal weather pattern event will be super-sized or monster-sized.  Water temperatures in the Pacific, one of the first signs of a looming El Niño, have measured much higher than normal.  In fact, water temperatures have been on par with the most severe El Niño event from the past 30 years.  As investors, we monitor larger climate events as severe weather can have an effect on most commodity markets.

This week, we will look at how an El Niño develops and its possible climate, economic and geopolitical effects on the global economy.  As always, we will outline the potential investment implications of this event.

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