Global growth expected to reach 3.4% in 2026. Source: IMF World Economic Outlook Update, January 2026. Earnings momentum looks good for emerging markets. And
Emerging Markets are projected to deliver approximately 14% earnings growth in 2026, compared to about 6% for the S&P 500. Valuations remain
“Typically, when you see geopolitical activity rise, you get a stronger dollar, not a weaker dollar like we've seen recently,” says Chris Hyzy, Chief Investment Officer for Merrill and Bank of America Private Bank. In the video above, Hyzy and senior investment strategist Lauren Sanfilippo share the reasons behind the CIO’s upbeat view on emerging markets and discuss factors to consider before adjusting your allocation. For timely market insights from the Chief Investment Office throughout the year, tune in regularly to the [Market Update audiocast series](/articles/daily-market-insights.html). Investing in emerging markets may involve greater risks than investing in more developed countries. Investments in emerging- and frontier-markets securities may be subject to greater market, credit, currency, liquidity, legal, political and other risks compared with assets invested in developed foreign countries. The Chief Investment Office (CIO) provides thought leadership on wealth management, investment strategy and global markets; portfolio management solutions; due diligence; and solutions oversight and data analytics.
Our 2026 outlook for emerging market (EM) equities is driven by cyclical factors such as a weaker US dollar, more favourable global financial conditions and
* [Global - English](https://www.mercer.com/?site=global). [Australia - English](https://www.mercer.com/en-au/). [Belgium - English](https://www.mercer.com/en-be/). [Canada - English](https://www.mercer.com/en-ca/). [Finland - English](https://www.mercer.com/en-fi/). [India - English](https://www.mercer.com/en-in/). [Ireland - English](https://www.mercer.com/en-ie/). [Jordan - English](https://www.mercer.com/en-jo/). [Malaysia - English](https://www.mercer.com/en-my/). [New Zealand - English](https://www.mercer.com/en-nz/). [Oman - English](https://www.mercer.com/en-om/). [Philippines - English](https://www.mercer.com/en-ph/). [Singapore - English](https://www.mercer.com/en-sg/). [Switzerland - English](https://www.mercer.com/en-ch/). [United States - English](https://www.mercer.com/en-us/). [Investment trends](https://www.mercer.com/insights/investments/market-outlook-and-trends/). * . * . * . The US Federal Reserve is likely to continue easing, with markets pricing rates just below 3% by year-end, though cuts may slow if growth firms or inflation remains above target[[3]](#references). [](#download). * [Investment trends](https://www.mercer.com/insights/investments/market-outlook-and-trends/ "Investment trends"). * [### Implementation and OCIO](https://www.mercer.com/solutions/investments/investment-solutions-and-ocio/). [Link to OCIO page](https://www.mercer.com/solutions/investments/investment-solutions-and-ocio/). * [### Sustainable investing](https://www.mercer.com/solutions/investments/sustainable-investment/). [Link to sustainable investment page](https://www.mercer.com/solutions/investments/sustainable-investment/). * [### Alternative investments](https://www.mercer.com/solutions/investments/alternatives/). [Link to alternatives and private markets page](https://www.mercer.com/solutions/investments/alternatives/). * [### Strategic research](https://www.mercer.com/solutions/investments/mercerinsight-community/). [Link to strategic research page](https://www.mercer.com/solutions/investments/mercerinsight-community/). * [### Asset manager research](https://www.mercer.com/solutions/investments/mercerinsight/). [Link to asset manager research page](https://www.mercer.com/solutions/investments/mercerinsight/). * [### Managing investment risk](https://www.mercer.com/solutions/investments/mercer-sentinel/). [Link to Mercer Sentinel page](https://www.mercer.com/solutions/investments/mercer-sentinel/).
Several factors suggest that this time may indeed be different, including stronger absolute and relative earnings growth; a weaker U.S. dollar; increased investor comfort with exposure to emerging markets after a period of prolonged under-allocation; reform progress across major emerging markets; and valuations that remain attractive relative to developed markets. Source: RBC GAM Emerging markets – Recommended sector weights Energy Materials Industrials Consumer discretionary Consumer staples Health care Financials Information technology Communication services Utilities Real estate Underweight Overweight 3.8% 7.5% 7.3% 10.1% 3.3% 2.9% 20.5% 33.6% 7.6% 2.2% 1.2% MSCI Emerging Markets 0.0% -2.2% -1.9% -0.6% 5.3% -1.0% 6.7% 2.2% -2.4% -2.4% -3.7% -10.0% -5.0% 0.0% 5.0% 10.0% Note: As of February 28, 2026. Emerging Markets Outlook_Spring 2026_E 03/19/2026 (03/2026) Disclosure This material is provided by RBC Global Asset Management (RBC GAM) for informational purposes only and may not be reproduced, distributed or published without the written consent of RBC GAM or the relevant affiliated entity listed herein.
[Skip to main content](https://www.reuters.com/world/asia-pacific/imf-cuts-emerging-economies-growth-estimate-war-darkens-outlook-2026-04-14/#main-content). * [World](https://www.reuters.com/world/). ## [Browse World](https://www.reuters.com/world/). * [Iran War](https://www.reuters.com/world/iran/). * [Business](https://www.reuters.com/business/). ## [Browse Business](https://www.reuters.com/business/). * [Take Five](https://www.reuters.com/business/take-five/). * [Markets](https://www.reuters.com/markets/). ## [Browse Markets](https://www.reuters.com/markets/). * [Commodities](https://www.reuters.com/markets/commodities/). * [Currencies](https://www.reuters.com/markets/currencies/). * [Emerging Markets](https://www.reuters.com/markets/emerging/). * [Funds](https://www.reuters.com/markets/funds/). * [Stocks](https://www.reuters.com/markets/stocks/). * [U.S. Markets](https://www.reuters.com/markets/us/). NEW YORK, April 14 (Reuters) - The IMF on Tuesday lowered its 2026 growth forecast for emerging market and developing economies to 3.9% from its view of 4.2% in January, with higher energy and food costs and uncertainty from the war in the [Middle East](https://www.reuters.com/world/iran/) expected to hurt more vulnerable, commodity-importing countries the hardest. The IMF [slashed](https://www.reuters.com/business/energy/imf-slashes-growth-forecast-middle-east-gulf-exporters-reel-impact-war-2026-04-14/) its 2026 forecast for the Middle East and Central Asia by 2.0 percentage points to 1.9%, one of the biggest revisions in the report, before a projected rebound to 4.6% in 2027 under its reference scenario. * [Emerging Markets](https://www.reuters.com/markets/emerging/). ## [World](https://www.reuters.com/world/). * [Home](https://www.reuters.com/). * [Home](https://www.reuters.com/). * [World](https://www.reuters.com/world/). * [Business](https://www.reuters.com/business/). * [Markets](https://www.reuters.com/markets/). * [](https://www.facebook.com/Reuters). * [](https://www.instagram.com/Reuters).
# World Economic Outlook Update. World Economic Outlook Update, January 2026: Global Economy: Steady amid Divergent Forces. #### Resilient growth as technology and adaptability offset trade policy headwinds. World Economic Outlook Update, January 2026: Global Economy: Steady amid Divergent Forces. Global growth is projected at 3.3 percent for 2026 and 3.2 percent for 2027, revised slightly up since the October 2025 World Economic Outlook. World Economic Outlook Update, January 2026: Projections Table. ###### World Economic Outlook Update, October 2025: Three Essential Questions. ###### Press Briefing: World Economic Outlook, October 2025. ###### World Economic Outlook, October 2025: Key Facts. ###### World Economic Outlook Update, October 2025: Three Essential Questions. ###### Press Briefing: World Economic Outlook, October 2025. ###### World Economic Outlook, October 2025: Key Facts. ###### World Economic Outlook Update, October 2025: Three Essential Questions. ###### Press Briefing: World Economic Outlook, October 2025. ###### World Economic Outlook, October 2025: Key Facts. Regional Economic Outlook Reports, All Regions.