Schroders Sees Solid Global Growth Amid Rising Inflation Concerns

Schroders, a UK investment firm, recently released its global forecast, which remains broadly unchanged. The outlook indicates that global GDP growth will continue to expand, reaching around 2.5 per cent in 2026 and 2.6 per cent in 2027.

The firm expects inflation to remain high, with a forecast of 3.3 per cent in 2026 before easing to 2.7 per cent in 2027. Notably, Schroders has increased its US inflation forecast due to persistent domestic price pressures.

In the eurozone, resilient activity and sticky services inflation have raised concerns about second-round effects, whereas greater labour market slack is expected to limit these pressures in the UK for now.

David Rees, head of global economics at Schroders, warned that instead of recession, the biggest threat to risk assets is the potential for long-term yields to surge higher due to questions over central bank credibility.