Goldman Sachs projects strong global growth in 2026, though job growth remains slow.

Global Economic Growth Forecast: Goldman Sachs predicts a global GDP growth of 2.8% in 2026, with the U.S. expected to grow at 2.6% and China at 4.8%, while the euro area is projected to grow at a slower rate of 1.3%.

Labor Market Concerns: Despite steady economic growth, labor markets are anticipated to remain stagnant, particularly in the U.S., where rising productivity is leading to a disconnect between GDP growth and job creation.

Inflation Trends: The bank expects disinflation to continue, with core inflation in the U.S. and U.K. projected to decrease to around 2% by the end of 2026, aided by factors such as cooling wage growth and declining oil prices.

Interest Rate Cuts and Market Outlook: Goldman forecasts a 50 basis point cut in the Federal Reserve's interest rates next year, which is expected to support equities and emerging-market assets, although high valuations and a fragile labor market may introduce volatility.