Our 2026 investment outlook summarises our views and insights on the key questions impacting our investment portfolios.
Contrary to the public narrative, key macro variables in 2025 were largely unchanged. Interest rates declined, inflation stayed marginally above target, and the AI investment boom maintained momentum. Entering 2026 our views remain quite consistent. Odds of recession seem low when we consider the combination of lower/declining rates, on-going fiscal stimulus and decreasing impact of tariffs. However, we do view the current environment as somewhat fragile. Deficits remain high, growth has become increasingly dependent on AI-related investment, and the expectation to generate return on substantial AI capital expenditure may place pressure on leading US technology companies. Frenzied private-market investment activity to access AI exposure further adds to this risk.
Against this backdrop, discipline remains critical. We believe taking a long-term perspective and constructing robust portfolios with diverse return drivers offers the best foundation for sustained compounding, particularly in the current environment.
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