Forward-looking macroeconomic and geopolitical insights and trends

Global growth is cooling as labor markets soften, job gains diverge, and divides widen. AI investment is outpacing consumer spending and manufacturing, raising jobless-growth risks and forcing firms to rethink skills, strategy, and flexibility.

Despite 2025 resilience from disinflation, cautious rate cuts and AI investment, global growth stayed fragile amid policy, geopolitical and trade risks. In 2026, clearer policies meet divergence, fragmentation, China-led competition and rising stress.

Growth is soft but stable, led by AI and exports as traditional sectors lag. Inflation fuels a two-speed economy, with AI lifting productivity in pockets and widening gaps. 

US tariffs are at their highest in a century, with reciprocal rates of 10-41% and sector tariffs of 25-50%. These measures could cut US GDP by at least 1% and add $2,400 in annual household costs, while heavily pressuring import-intensive sectors. Companies must strengthen resilience and adapt to a more fragmented global trade landscape.

Global growth is slowing amid tariffs, fiscal reform, and weaker demand. Targeted government spending boosts green tech, defense and digital sectors, but rising deficits and policy risks require disciplined capital allocation and regional agility.

Tariff uncertainty and policy volatility weigh on the global economy. Businesses must prepare for shifting demand and supply disruptions amid deteriorating sentiment and uneven regional outlooks.

Elevated tariff uncertainty and persistent policy volatility continue to weigh on the global economy. While activity and spending reflect frontloading and caution, sentiment is deteriorating. With uneven regional outlooks, businesses must prepare for shifting demand and supply disruptions.

The US faces its highest tariff rates in over a century, straining trade and key sectors. Despite signs of easing, uncertainty persists. Businesses should focus on financial resilience and scenario planning to navigate ongoing volatility.

Activist investors remain a major concern, with nearly a third of large public companies facing a high risk of targeting. While campaigns may lift short-term returns, they can undermine strategy and long-term value, making proactive, value-led leadership essential.

The global economy is entering a new era where supply scarcity drives outcomes. This Great Supply Squeeze will bring challenges but also opportunities for companies that adapt, offering a chance to gain a competitive edge in the new normal.