2026 Economic Forecast: Global Trends, Regional Divergences

In this paper, we discuss:

• Global growth in 2026 remaining stable but modest constrained by geopolitics, demographics, and weak productivity;
• Diverging inflation paths, with the eurozone nearing target, the US staying above it, Japan easing below 2%, and China still facing deflationary pressure;
• A US soft landing, with slower growth as monetary tightening bites, but inflation supported by tariffs, fiscal stimulus, and labour constraints;
• The eurozone’s gradual recovery, led by domestic demand, fiscal support, and a modest German rebound, while structural challenges persist;
• China’s export-led resilience, driven by industrial upgrading, even as property-sector weakness weighs on inflation.

Download PDF: Economic Forecasts 2026 – LK – January 2026