Only a few weeks into 2026, there are already plenty of macroeconomic factors for advisors and investors to keep a close eye on.
Both domestic and geopolitical headlines from the federal government can cause one’s portfolio to shift, be it in a positive or negative direction. And that’s before advisors even consider how interest rate policy and the independence of the Federal Reserve can further move the needle. Indeed, in recent days the executive branch has begun to threaten the independence of the Fed once more. Plus, all of this is playing out while inflation worries bubble in the backline.
The Fed Subpoenaed: What Comes Next
In a recent Office Hours session, titled “Trump, the Fed, and Other Key 2026 Storylines” the experts at WisdomTree broke down what advisors should be aware of in regards to the biggest drivers of 2026’s market. To get things rolling, WisdomTree first addressed the recent news that the Department of Justice has subpoenaed the Federal Reserve.
Kevin Flanagan, WisdomTree head of fixed income strategy, evaluated how these unexpected developments are affecting advisors and investors alike. To start, Flanagan noted that some voices in the room urge against pressuring the Fed in this manner. Those include Treasury Secretary Scott Bessent and some members of the Senate Banking Committee.
“I think cooler heads are prevailing at this stage of the game, but that doesn’t mean that the notion of questioning the Fed’s independence is going to go away over the next three years,” Flanagan assessed.
In terms of how the market is responding, Flanagan observed that the markets obviously pulled back when the news first broke. However, as this story develops, Flanagan expects more advisors and traders to adopt a wait-and-see mindset until more clarity is established.
For the Fed’s future, Flanagan anticipated that Powell would finish out his term as chair of the Federal Reserve. However, as Flanagan pointed out, that brings up another question. Will Powell stay on as a governor until 2028? Given how fast the news cycle is moving these days, it may be too soon to tell. However, it’s certainly something advisors should be keeping in mind.
How Accurate Is the CPI?
Beyond what’s going on at the Federal Reserve, many remain concerned about where the inflation outlook stands for the U.S. markets. Jeremy Schwartz, WisdomTree global chief investment officer, took a look at how the U.S. government’s inflation data may be less accurate than advisors realize.
Schwartz explained WisdomTree’s longstanding belief that the Bureau of Labor Statistics uses a “very stale” method for calculating shelter data for the Consumer Price Index (CPI), potentially making the longstanding inflation measure an unreliable barometer. Instead of using lagging data like the BLS does, the WisdomTree team looks to utilize more real-time data, which can create a different picture of where inflation sits.
Regardless of where the real inflation numbers lie, Schwartz asserted that advisors and investors remain underexposed to commodities, especially gold. There are plenty of opportunities across the broad spectrum of commodities, both to hedge against inflation and to capitalize on potential long-term gains.
Opportunities in the Japanese Market
Commodities aren’t the only investments worth a closer look. Among the many ETFs highlighted during the webcast, the WisdomTree team showcased the WisdomTree Japan Opportunities Fund (OPPJ) as a potentially compelling choice for 2026.
To start, Japanese equities may already be worth a closer look as the country enters a much more positive economy than recent years, bolstered by more favorable fiscal policy. Moderate inflation and an expected increase in disposable income countrywide makes Japanese companies a potentially good buy right now.
OPPJ offers an opportunity for investors to buy into the Japanese companies that WisdomTree believes represent the best opportunities at the moment. The fund invests in companies from four different buckets: Japanese companies held by Berkshire Hathaway; companies with high shareholder yield; companies with low valuation ratios and strong growth and earnings potential; and lastly, thematic picks. This balanced approach gives OPPJ a well-balanced view of the different companies within the Japanese economy.
OPPJ is just one of many funds that could offer a compelling route to navigate the uncertainty of the 2026 U.S. markets. Looking ahead, advisors should remain nimble, and when in doubt, lean on the perspective of market experts in order to find the best path forward.
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This article was prepared as part of WisdomTree's general paid sponsorship of VettaFi | ETF Trends. This specific content within and any opinions expressed therein belong solely to VettaFi and do not reflect the opinion or analysis of WisdomTree, its employees, or its affiliates. Content published on VettaFi | ETF Trends is provided for educational purposes only and should not be considered investment or tax advice. For investment or tax advice, please consult a financial professional.
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