Crystal Ball 2026 – Down but not out
Across global banks, asset managers, and research institutions, the consensus view for 2026 is of a sub-trend but resilient global economy transitioning into a post-inflation, late-cycle phase. Growth is expected to remain positive but uneven, led by the U.S. and parts of Asia, while Europe lags amid structural and fiscal constraints. Inflation is broadly forecast to moderate toward central-bank targets, giving policymakers room for gradual and cautious rate cuts, though a return to the ultra-low-rate era is not expected. Financial markets are seen shifting from liquidity-driven gains to earnings- and fundamentals-based performance, with lower average returns, higher dispersion across assets, and sustained volatility. Structural forces — geopolitical fragmentation, elevated debt, demographic pressures, and the transition to a more multipolar global order — dominate cyclical drivers, while technology and AI-led productivity gains remain the key upside risk. Overall, instit...