Press release
Northern Trust Pension Universe Data: Canadian Pension Plans on solid footing in Q1 2023 despite market turmoil
TORONTO--(BUSINESS WIRE)-- Canadian Pension plan investment returns demonstrated resilience during the first quarter of the year, shrugging off volatility
About this update from Northern Trust Corporation
[{"type":"text","content":" TORONTO--(BUSINESS WIRE)--\nCanadian Pension plan investment returns demonstrated resilience during the first quarter of the year, shrugging off volatility and turmoil that erupted within the U.S. banking sector, according to the Northern Trust Canada Universe. The median Canadian Pension Plan returned 4.2% for the quarter.\n\n\nThe first quarter of 2023 was marked by continued high inflation and tight labor markets, expectations of prolonged monetary tightening and a banking crisis triggered by the collapse of Silicon Valley Bank and the subsequent downfall of Credit Suisse. Assertive actions undertaken by the U.S. government and Federal Reserve (Fed), the Swiss National Bank and Financial Market Supervisory Authority(FINMA) served to restore confidence and stability within the banking sector.\n\n\nThroughout the period, most major central banks stayed the course in their fight against inflation, hiking interest rates with the objective of restoring price stability in the economy. The Bank of Canada (BoC) was the exception as it became the first major central bank pivoting to a pause mode, in an effort to assess the impact of consecutive rate hikes over the last year. Despite economic and global disruption, including devastating earthquakes in Turkey and Syria, financial markets concluded the first quarter on a strong note, with both equities and bonds producing attractive returns for the period.\n\n\n“The confluence of events taking place this quarter unveiled the unwavering nature of monetary authorities, as they remained focused on their commitment to tame inflation. As central banks navigated through the ongoing macro tensions, pension plans rose to the occasion underscoring their adaptive nature generating superior returns during such a precarious period,” said Katie Pries, President and CEO of Northern Trust Canada.\n\n\nThe Northern Trust Canada universe tracks the performance of Canadian institutional defined benefit plans that subscribe to performance measurement services as part of Northern Trust’s asset servicing solutions.\n\n\nDuring the first quarter of 2023, monetary authorities remained focused on the pillars of inflation. Absolute readings continued to be much higher than central bank targets, however the trajectory of inflation signaled restrictive monetary policy was gaining traction. Financial markets navig...