Inflation/Deflation

Our Portfolio Allocation Summary for January 2026.

Our outlook for Fed policy in 2026.

Employment Data Point To Dovish Policy Surprises In 2026

This year, we once again present our 2026 outlook as a retrospective from the future – a future in which the AI boom turned to bust.

Next week, please join me for a Webcast on Wednesday, December 17 at 10:30 AM EST (3:30 PM GMT, 4:30 PM CET) to discuss the economy and financial markets. We will also host a Webcast for APAC on Tuesday, December 16 at 8:00 PM EST (9:00 AM HKT+1 day).

And with that, I will sign off for the year. I wish you and your loved ones a very happy and healthy 2026. We will be back on Friday, January 2 with our MacroQuant Model Update.

The Fed is on hold for now, but its 2026 economic projections are far too optimistic. The Fed will ease more next year than it currently anticipates. 

Our Portfolio Allocation Summary for December 2025.

Our key US fixed income views for 2026.

Indian stocks have further downside in absolute terms as profits disappoint. Their underperformance versus the EM equity benchmark, however, is late, which warrants a shift from underweight to neutral allocation.

Our Portfolio Allocation Summary for November 2025.

The Fed cut rates today, but a follow-up rate cut in December is uncertain. It will depend, in large part, on who wins a debate about the neutral rate of interest.