That slack-jawed look of surprise investors were making for most of 2016? It's not going anywhere. Political volatility is here to stay.
For almost a third of high-grade credit investors, populism in politics is the biggest concern for the next 12 months, according to a Bank of America Merrill Lynch Global Research report published on Dec. 19. In a similar survey in October, before Donald Trump's surprise election win, fewer than one in 10 had put it as their main worry.
They have reason to be concerned. The Netherlands, France and Germany all hold national elections in coming months. With unemployment and stagnant wages fuelling voters' antipathy to immigration, there's the risk of a populist upset. These charts show the gains parties from Germany's AfD to France's National Front have made in recent opinion polls.
None of these populist challengers may win -- Germany's constitution is designed to promote consensual coalitions. But the severity of the perceived threat can still move markets: look how the pound rose and fell with chances of a remain vote.
And none of what caused the volatility of 2016 is going away. There's still a Brexit to be negotiated, and Trump takes office on Jan. 20. Buckle up.
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