Get ahead of 2026 volatility with the economic signals, and scenario plays, your finance strategy can’t afford to miss.
January 8, 2026
As we head into 2026, CFOs face a complex mix of modest global growth, evolving monetary policy, trade uncertainties, and pressure to translate AI investments into measurable value. While some dynamics are new, many reflect familiar patterns. The challenge for CFOs isn’t predicting the outcomes but preparing for multiple ones. The 2026 economic outlook ultimately depends on factors such as AI-driven productivity, trade policies, inflation, and geopolitical stability.
The IMF projects global growth at about 3.1% in 2026 with advanced economies around 1.5% and emerging markets above 4%. This is on the heels of 3.2% growth in 2025, and 3.3% growth in 2024, respectively. Trade uncertainties and tariff friction mean growth will be uneven, and some regions performing better than others.
Meanwhile, inflation should continue to decline as commodity pressures ease, but core inflation—particularly in services and wages—is likely to remain stickier.
What this means for CFOs:
A single top-line forecast won’t cut it. Build regional revenue scenarios that reflect divergence in growth.
Allocate capital to markets with stable growth, and adjust hiring, expansion, or investment plays by region.
Stress-test your budget by assuming slower growth or temporary stalls in weaker regions.
As US inflation moderates, central banks are expected to play a pivotal role in shaping the economic outlook for 2026. The US Federal Reserve could gradually ease rates. The pace and scale of these adjustments will hinge on economic data, requiring the ability to model multiple scenarios to reflect uncertainty.
What this means for CFOs:
Don’t assume funding costs will drop immediately. Model scenarios where rates fall slowly, stay higher for longer, or move unpredictably.
Consider hedging interest-rate exposure on debt or long-term projects.
Incorporate rate assumptions into your capital allocation and cost of capital planning.
Trade disruptions are expected to be patchy and sector-specific, rather than a global collapse. Companies with concentrated suppliers, thin margins, or high import exposure should prepare for potential cost shocks if tariffs rise.
What this means for CFOs:
Run what-if scenarios modelling potential tariff increases (even marginal increases on key imports).
Assess margin and cash flow impact under each scenario.
Explore alternative suppliers or hedging strategies to reduce dependency on high-risk trade flows.
If the US decides to aggressively cut interest rates, it’s likely to see a weakening USD against other currencies—a dramatic shift from how it has historically performed. Commodity-dependent and trade-exposed currencies may experience the most volatility, especially as commodity prices are expected to be sensitive to the economy. Over time, we may see a gradual move towards more normalised currency relationships.
What this means for CFOs:
Conduct FX sensitivity analyses, testing small moves in your key currencies.
Base your planning on actual cash flows rather than speculations.
Hedge critical exposures where possible and update regularly as markets move.
Rising AI valuations, fuelled by artificial intelligence and AI-driven investments, have become a major market driver, yet practical execution often lags investor expectations. The pressure to keep pace with early adopters of AI has created a wave of investments, fuelling a sharp rebound in tech sector performance. This gap may trigger valuation corrections on the horizon, with potential implications for capital planning and investment strategies.
What this means for CFOs:
Prioritise AI initiatives with demonstrable ROI or cost savings; pause projects with speculative outcomes.
Use AI, like Copilots or Agents, and advanced analytics to run scenario models for your business, preparing for those potential market shifts.
Consider the impact of potential stock-market corrections on compensation, investments, or corporate funding strategies.
Across growth, inflation, interest rates, FX, and proving AI value, uncertainty will continue throughout 2026. But CFOs who proactively run scenarios, allocate capital strategically, and stress-test assumptions will be best positioned to navigate volatility and, more importantly, capture opportunities.
The key takeaway for finance teams: flexibility, preparation, and data-driven decision making are essential. This level of preparedness increasingly requires faster modelling, tighter data integration, and the ability to test assumptions in real-time. By planning multiple scenarios, you can mitigate risk, preserve liquidity, and make confident strategic choices, even amid macroeconomic uncertainty.
