Emerging markets (EMs) are entering 2026 as a central force in the reordering of global growth. The combination of a softer U.S. dollar, moderating inflation, and stronger domestic fundamentals has created conditions for a more sustainable expansion across asset classes. Capital is rotating toward higher-quality companies and higher-yielding sovereigns, while policy realignment in China and other key economies is shifting the balance of global manufacturing, technology, and trade. Against this backdrop, we believe emerging markets are poised to play a defining role in the next phase of global rebalancing—where growth leadership broadens, diversification deepens, and structural change becomes the primary driver of returns.
