Eclecticism and 2026 economic trends

In this series, we explore insights from notable articles or books and share thoughts inspired by ‘The Good Read.’ With the festive season and numerous predictions circulating, I’ve selected key trends worth watching in 2026.

This month, the trigger for thought comes from Momentum Global Investment Management’s “Top five trends for 2026”. MGIM’s research team has long been on my reading list- and for a good read try clicking on the link.

The read sparked several thoughts. Here are my top five trends for 2026:

1.     Central Banks and the decaying influence of the USD.

The MGIM article brings up the expectations of global Central Banks taking divergent routes. Given the role of a Central Bank is to manage a nation’s currency and monetary policy, setting interest rates to control inflation and so on- this puts an eagle eye on every nation’s currency against the USD. Why? Simply because in recent history the USD has been the bedrock of global trade and the main currency for international transactions.

As my Gold Trader put it: “Countries are moving away from the USD. The Dollar has been used as a diplomatic weapon. Confidence in our financial system is collapsing”.

FOR READERS: The take-away is: if your home currency/base currency is USD- then your currency risk exposure is minimal, unless Gulf currencies make the unlikely but dramatic move towards a BRICS currency. However, for every other expatriate- keep an eye out on your base currency Central bank and currency swings.

2.     Gold and Silver- “the new black stuff”.

For those of a certain age, they might remember oil being described as “the new gold”. The formation of OPEC and the embargos (1973 and 1979) caused prices to quadruple, solidifying oil as the most influential driver of the global economy.

For 2026, gold and silver are seemingly going to get some of their sheen back. Silver, for example, is essential for many industrial processes from solar panels to EVs to electronics. From Jan 1- China has announced that exporters will need a license suggesting control is required.

However, with our point 1 suggesting growing discontent with the USD- this will also spur gold and silver’s demand as a means of exchange and a store of value.

FOR READERS: the take-away is, Gold (and let’s throw in silver) has long been seen as a diversifier within portfolios. 10% being an oft-quoted position. Time for an increase?

3.     The US-Mid-terms.

The US position in the world has been radically changed by Mr. Trump. Good, bad or ugly, readers will decide. What is certain is that the US of 2025 had a different personality than the same country post 1945. Friends and allies have changed. Additionally, we have the elephant in the economic room: tariffs. An eclectic read around on this will reveal very few supporters outside of Mr. Trump’s dream team.

All of that gets put to the test late in 2026 as the American people will decide whether democracy survives and whether, as MGIM state “voters entrench divided government or hand one party a clearer mandate”.

FOR NON-AMERICAN READERS: A This is challenging for non-American readers, because we don’t even get to vote on who should be running the strongest economy in the world.

4.     Public capital markets versus private markets.

The Harvard Endowment portfolio has long been on my reading list as to what to look for in portfolio planning. Given that this fund is now over USD 50 billion and manages an average return of 11% p.a. - they must be doing something right.

The 2025 asset allocation will surprise many portfolio traditionalists - those who rely on cash, bonds, and equity markets.  The 2025 allocation is 41% in Private Equity: 31% in Hedge Funds and only 14% in Public Equities.

FOR READERS: The key to note is the lack of confidence in Public Markets. The weight of underlying asset is heavily focused on private capital and hedge funds which means that manager selection is critical and given their complex nature – one where expert advice is also critical.

5.     NVIDIA et al

The disclaimer first: this isn’t advice. We can’t tell you how your investments in tech and the “Magnificent 7” are going to fare in 2026*. What we can say is that the trend towards AI will be one, like the motor car, that will change the economic world. It is interesting that the UAE wishes to be at the front of that. However, these stocks are clearly highly overvalued if you take the PE ratios as a measure.

FOR READERS: If you are investing in AI stocks or the “Magnificent 7,” the prudent approach is to adopt a multi-year, medium-term perspective. Expect periods of downside deviation caused by overpricing—these may present opportunities to buy more. While the long-term trend for AI investment remains positive, the short-term outlook is, like any single-year investment, inherently speculative.

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* Apple; Microsoft; Amazon; Alphabet; META; Tesla and Nvidia