en-GB

gb_intm_classes

featured_gb_intm

intm

Intermediary

For use by professional clients and/or equivalent investor types in your jurisdiction (not to be used with or passed on to retail clients).

Weekly Perspectives: Looking forward to 2026

Anthony Willis

Senior Economist, Multi-Asset Solutions team

Key Takeaways

This week we see a raft of data releases with US non-farm payrolls and inflation numbers in the US and UK. There are also central bank meetings in Europe, the UK and Japan.
Heading into 2026 our view is that overall growth looks resilient with both fiscal stimulus and monetary policy set to add support.
European growth (especially in Germany) could pick up, and China is expected to maintain its 5% target. The US could repeat 2025’s performance but the UK is set for another year of lacklustre growth.
The impact of tariffs turned out to be less than anticipated but they will likely remain a feature in 2026. Supply chains and the global economy will continue to adjust.
Valuations across equity and bond markets reflect much good news and investors will be monitoring the monetisation of AI closely. Will companies be able to avoid disappointment around returns on capital expenditure?

Transcript

It is our final update of the year but there is plenty going on this week in financial markets. We have the belated release of US non-farm payroll data – numbers that were delayed by the US government shutdown. Will insight into both October and November change the narrative slightly on the state of the US labour market? Recent data has been mixed but served to challenge the view that there is a sharp softening in the US labour market. We also have inflation numbers in the UK and the US and on top of those three central bank meetings. The European Central Bank is expected to hold, the Bank of England expected to cut and arguably most notably, the Bank of Japan looks set to hike rates by 25 basis points.

Looking forward into 2026 our view is that global growth looks resilient and on balance we think that 2026 could be a year of ‘extending the cycle’. By that we mean we are expecting fiscal stimulus and monetary policy to both be supportive. In combination this backdrop should keep global growth on a par if not slightly above what we’ve seen in 2025.

On the fiscal side we are expecting stimulus in Japan. Germany has announced stimulus already and, in the US, the “One Big Beautiful Bill” was agreed in Congress. This will start kicking in and positively impacting the economy. China is also expected to pursue incremental measures to keep the economy ticking. On the monetary policy side, we expect to see divergence in 2026. The US and UK will likely see further rate cuts, and we could see an acceleration in the trend in the US given a more dovish Fed chair is set to be appointed by President Trump. In the UK we expect to see a couple of rate cuts over the course of 2026 – downward moves that will be in addition to this Thursday’s anticipated rate cut. For the eurozone, rates are likely to remain on hold unless something dramatic happens. Japan is heading in the other direction, and rates will tick upwards as the Bank of Japan becomes more confident that inflation is entrenched and moving towards their 2% target.

Looking at the economic outlook we are forecasting solid growth for 2026. We expect a pickup in growth in parts of Europe with Germany particularly well placed thanks to announced stimulus. China is expected to maintain their growth target of about 5% and US expansion likely to be in line with this year. The UK growth outlook remains lacklustre but not significantly different to 2025. There is some scope however, for it to deteriorate at the margin.

Tariffs are here to stay but we still lack clarity around their legal status and are awaiting a US Supreme Court ruling. Irrespective of the decision, tariffs will likely be a continuing theme for 2026 but the global economy and supply chains are adjusting accordingly.

We head into 2026 with both equity and bond valuations looking pretty rich and that leaves limited margin for error. Given the AI theme remains dominant there is scope for disappointment should related companies miss very high expectations for future growth. More broadly, 2026 will likely be a year in which AI monetisation and generating returns on related capex becomes more of a theme.

Politics is set to be relatively quiet in terms of what’s scheduled, but it probably won’t turn out that way! November will see the US midterms and the results will help shape what happens in the final two years of President Trump’s four-year term. We have UK local elections and these could shape the political destiny of Keir Starmer and Rachel Reeves. Further afield the Brazilian presidential elections are looming and President Lula will stand for re-election.

On balance we head into 2026 with a relatively optimistic mindset and do expect a positive year for global growth. At the same time, we are cognisant that a lot of good news is already priced in.

15 December 2025

2025年 December 15日

Key topics

Subscribe to insights

Get the most out of your email by tailoring the types of insights and information you would like to receive from us.

Latest articles

15 Dec 2025

2025年 December 15日

Weekly Perspectives: Looking forward to 2026

This week we take a closer look at Japan and the likelihood of an interest rate hike at the end of December.

8 Dec 2025

2025年 December 08日

Weekly Perspectives: What happens when Japan hikes rates?

This week we take a closer look at Japan and the likelihood of an interest rate hike at the end of December.

1 Dec 2025

2025年 December 01日

Weekly Perspectives: Can we now move on from the UK budget?

Chancellor Rachel Reeves achieved her budgetary goals: – the OBR is happy, markets are calm, and Labour backbenchers are content. But is that good enough?

Key topics

Risk Disclaimer

The value of investments and any income derived from them can go down as well as up as a result of market or currency movements and investors may not get back the original amount invested.

Views and opinions expressed by individual authors do not necessarily represent those of Columbia Threadneedle.

Important information

Columbia Threadneedle Investments is the global brand name of the Columbia and Threadneedle group of companies.

For professional investors only.

This financial promotion is issued for marketing and information purposes only by Columbia Threadneedle Investments in the UK.

The Fund is a sub fund of Columbia Threadneedle (UK) ICVC III, an open ended investment company (OEIC), registered in the UK and authorised by the Financial Conduct Authority (FCA).

English language copies of the Fund’s Prospectus, summarised investor rights, English language copies of the key investor information document (KIID) can be obtained from Columbia Threadneedle Investments, Cannon Place, 78 Cannon Street, London, EC4N 6AG, email: [email protected] or electronically at www.columbiathreadneedle.com. Please read the Prospectus before taking any investment decision.

The information provided in the marketing material does not constitute, and should not be construed as, investment advice or a recommendation to buy, sell or otherwise transact in the Funds. The manager has the right to terminate the arrangements made for marketing.

Financial promotions are issued for marketing and information purposes; in the United Kingdom by Columbia Threadneedle Management Limited, which is authorised and regulated by the Financial Conduct Authority; in the EEA by Columbia Threadneedle Netherlands B.V., which is regulated by the Dutch Authority for the Financial Markets (AFM); in Switzerland: Issued by Threadneedle Portfolio Services AG, Registered address: Claridenstrasse 41, 8002 Zurich, Switzerland. In the Middle East: This document is distributed by Columbia Threadneedle Investments (ME) Limited, which is regulated by the Dubai Financial Services Authority (DFSA). For Distributors: This document is intended to provide distributors with information about Group products and services and is not for further distribution. For Institutional Clients: The information in this document is not intended as financial advice and is only intended for persons with appropriate investment knowledge and who meet the regulatory criteria to be classified as a Professional Client or Market Counterparties and no other Person should act upon it.

Please confirm a few details about yourself to visit your preference centre

*Mandatory fields

Something went wrong, please try again

Thank you. You can now visit your preference centre to choose which insights you would like to receive by email.

Visit preference centre

To view and control which insights you receive from us by email, please visit your preference centre.

Visit preference centre

CT Property Trust- Fund Manager Update

Sed ut perspiciatis unde omnis iste natus error sit voluptatem accusantium doloremque laudantium

Weekly Perspectives: Looking forward to 2026

Key Takeaways

Subscribe to insights

Latest articles

Weekly Perspectives: Looking forward to 2026

Weekly Perspectives: What happens when Japan hikes rates?

Weekly Perspectives: Can we now move on from the UK budget?

Thank you. You can now visit your preference centre to choose which insights you would like to receive by email.

Explore our CT Universal MAP ranges

Portfolio insights

Resources and support

Risk Disclaimer

Please confirm a few details about yourself to visit your preference centre

Thank you. You can now visit your preference centre to choose which insights you would like to receive by email.

To view and control which insights you receive from us by email, please visit your preference centre.

CT Property Trust- Fund Manager Update

Weekly Perspectives: Looking forward to 2026

Key Takeaways

Subscribe to insights

Latest articles

Weekly Perspectives: Looking forward to 2026

Weekly Perspectives: What happens when Japan hikes rates?

Weekly Perspectives: Can we now move on from the UK budget?

Sign up to receive insights, information and reporting

Thank you. You can now visit your preference centre​ to choose which insights you would like to receive by email.

Explore our CT Universal MAP ranges

Portfolio insights

Resources and support

Risk Disclaimer

Please confirm a few details about yourself to visit your preference centre

Thank you. You can now visit your preference centre to choose which insights you would like to receive by email.

To view and control which insights you receive from us by email, please visit your preference centre.

CT Property Trust- Fund Manager Update

Thank you. You can now visit your preference centre to choose which insights you would like to receive by email.