Asset Management: Monthly Macro Insights - March 2026

The global economy is characterised by a fragile combination of resilience and vulnerability, with the US continuing to act as the main anchor of global growth. Markets are facing an environment in which inflation dynamics remain uneven and geopolitics have re-emerged as a central source of risk, while resilience is increasingly concentrated in a narrow set of drivers – most notably artificial intelligence (AI).

US exceptionalism once again?

Unlike most advanced economies, growth expectations for the US in 2026 have been revised upward in recent months. However, this upgrade masks a growing concentration of growth drivers, as activity relies heavily on investment linked to the development and deployment of AI related infrastructure, data centers, semiconductors, and software. While this AI led growth model offers substantial upside, it also introduces new vulnerabilities. Overall, the US economy’s growth outlook has improved, but its resilience may be more conditional than expected. A shock that disproportionately affects investment sentiment or financial conditions could therefore have outsized effects.

The war on inflation is not over

Despite some progress, the US economy continues to operate in an environment that is, in a broad sense, inflationary. In fact, the Fed faces a complex trade off: easing policy further risks reigniting inflation expectations, while maintaining a restrictive stance for too long could eventually undermine labour market stability. As a result, inflation remains a key source of macroeconomic uncertainty.

Geopolitical risks and global spillovers

Beyond domestic dynamics, geopolitical risks have become increasingly salient, and the potential consequences of the US conflict with Iran are significant enough to warrant close attention.

Although the duration of the conflict and the nature of any regime change in Iran is key to understanding the economic impact, the most immediate transmission channel is energy prices. Beyond energy, the conflict with Iran could trigger a broader rise in uncertainty. In an environment where growth already relies on a narrow set of drivers, such as AI investment, the global economy may be more sensitive to such shocks than headline resilience suggests.