Our top thought leaders and investment experts share their insights on the role of innovation in driving growth, corporate profitability and investment opportunities.
Download the ReportIn 2026, we expect modest global economic growth, with ongoing innovation enabling the U.S. to maintain its leadership. After proving resilient in 2025, the U.S. economy is poised to benefit from AI-driven productivity gains, stable consumer spending and further monetary easing. We expect earnings growth to improve as pro-business legislation, rapid AI adoption and monetary easing boost corporate profits. Meanwhile, the One Big Beautiful Bill Act and lower borrowing costs will support consumers.
We invite you to explore five themes creating investment opportunities and see how we can help you navigate the year ahead.
We anticipate that U.S. economic leadership will continue, with shifting labor dynamics, consumer strength and pro-growth policies supporting this narrative.
Accounting for 70% of GDP, consumption remains a critical part of the growth story. Rising asset values (stocks and housing) combined with low levels of debt, also known as the wealth effect, have continued to strengthen household balance sheets. In fact, according to the Fed, since 2020 net worth has increased from $116 trillion to $176 trillion today, while household debt levels are the lowest in over 50 years.
Although bond yields have come down from their recent highs, they continue to look attractive relative to those of the previous decade. This is important because the initial yield at which you invest is typically a good proxy for expected long-term returns.
While we are positive on fixed income next year, investors should still be prepared for periods of volatility. An active approach can capitalize on interest rate movements, harvest losses to minimize the impact of taxes, assess the credit quality of bond issuers, and exploit dislocations.
We believe the equity bull market has more room to run as earnings growth is expected to broaden across all sectors of the S&P 500. Improving productivity and profitability due to AI technology, Fed rate cuts and business-friendly policy provisions should support positive earnings momentum.
We continue to favor U.S. equities over non-U.S. stocks. Earnings growth is higher in the U.S., and we expect the trend to persist. Additionally, the U.S. is the growth leader of the developed world and has more favorable deregulation policies that give it an advantage over other markets.
Technology has always been a disruptive force, but never has that development been more pronounced than today, as AI is poised to surpass prior innovations in reach and impact.
For example, internet adoption took six times as long as AI to reach about 800 million users. Today, AI permeates every corner of our lives, from consumer applications to industrial processes. The investment opportunities have never been more compelling.
Although many investors gain AI exposure through public companies, private markets offer an attractive pathway to capture early-stage value creation. Venture capital investments should continue to provide broad exposure to the most transformative breakthroughs of the AI revolution.
As AI continues to ramp up, there is unprecedented demand for computing power and the physical infrastructure on which it relies. Investors can tap into these AI megatrends through real asset funds or pooled investment vehicles that allocate to tangible, income-producing assets such as real estate, infrastructure and natural resources.
BNY has long been at the forefront of connecting institutional finance with the fast-evolving world of digital assets. From modernizing payments infrastructure and launching an institutional digital custody platform to piloting tokenization of real assets, we harness digital innovations to improve efficiency and enhance services.
For more than a decade, we have recommended participation in the initial growth phase of the underlying blockchain technology through our venture capital vehicles within private equity funds. However, it is important to note that cryptocurrencies, such as Bitcoin, remain a volatile asset class. As the regulatory landscape evolves, we continue to evaluate the investment merits and risks associated with investing directly in this asset class.
