Yearly Outlook 2026

2025 proved again to be a year of resilient global economic growth and strong returns for risk assets. However, it certainly didn’t feel that way in early April as we all grappled with what President Trump’s Liberation Day meant for economies and markets. As it turned out, however, the worst tariff scenarios were avoided as Trump walked back from initial tariff levels, and importantly there were strong tailwinds for the US and global economies. Interest rates continued to be cut as inflation stabilised, and record levels of capex were invested in AI and technology. Highly stimulatory fiscal US deficits were continued if not increased with the passing of the One Big Beautiful Bill (OBBB) by the US congress.

As we shift into 2026 one of the biggest challenges is thinking through where we are in the cycle, and how much risk and credence we should attach to the highly unconventional Trump administration.