Robeco publishes 2026 Outlook: ‘The synchronized shift’

Robeco’s base case projects US real GDP growth at 2.1% in 2026, supported by AI-driven productivity
gains and fiscal stimulus through the One Big Beautiful Bill Act. However, the US economy remains
divided, with high-income consumption buoyant and lower-income households facing pressure from
rising tariffs and slowing job growth. Europe’s growth engine is revving up, with Germany showing
accelerating activity on the back of fiscal stimulus. The eurozone is expected to grow by 1.6%, aided by
fiscal expansion and pent-up consumer demand. China, while still battling deflationary pressures, may
see a domestic revival in H2 2026 as housing market deleveraging nears its end.

In a bull scenario, fading geopolitical shocks and improved domestic consumption in China reignite
global growth, pushing US GDP to 2.9% and strengthening the dollar. Conversely, Robeco’s bear case
envisions fading US exceptionalism, a bursting AI bubble, and rising unemployment, potentially
triggering a mild recession.

Peter van der Welle, Multi-Asset Strategist at Robeco: “The synchronized shift is our ‘Neapolitan chord’
moment – a rare harmony before the finale. But it’s not an ending. As global economies align briefly,
investors must remain agile, balancing optimism with caution in a data-driven, policy-sensitive
environment.”

Financial markets outlook
Robeco sees potential for a continued equity rally, especially in rate-sensitive sectors and regions
outside the US. While US valuations remain stretched, earnings delivery – particularly in the tech sector
– will be key. Eurozone equities appear attractive on valuation and macro tailwinds. Emerging markets
may benefit from a weaker dollar and improved trade flows.

In fixed income, Robeco favors shorter-duration exposure amid expectations of higher long-end yields.
High yield spreads remain tight, limiting upside, while emerging market debt offers reasonable carry.
Industrial metals could rally on cyclical momentum, while gold faces mixed signals from inflation and
Fed policy.

Sustainable investing outlook
Robeco’s 2026 sustainable investing outlook, ‘Holding the note’, reflects a steady but subdued
trajectory. While ESG fund flows have stabilized, themes like climate adaptation and responsible AI are
gaining prominence. Investors are expected to focus more on energy-related themes, managing physical
climate risks and reassessing energy-intensive sectors like AI infrastructure. Despite geopolitical
headwinds and regulatory uncertainty, the long-term sustainability trend remains intact. Europe
continues to lead with regulatory clarity and green bond issuance, while the US sees mixed signals amid
political polarization. Defense-related investments are being reevaluated, with a broader value chain
offering nuanced opportunities.

Rachel Whittaker, Head of Sustainable Alpha Research at Robeco: “Sustainable investing is not
retreating – it’s recalibrating. As the tempo shifts, we’re holding the note in the interest of our clients,
while adapting to new realities. Remaining focused on our long-term investment beliefs reinforces the
relevance and resilience of sustainable investing: built not on trends, but on science and enduring
principles.”

Source: Broadridge Global Market Intelligence. Eq/Bonds/MA, Global, ESG Focus only. Data as of 5
November 2025.

Despite global outflows from SI funds in 2025, sustainable fixed income proved more resilient than
equities.