According to Jin10, China International Capital Corporation (CICC) highlighted in its 2026 macroeconomic outlook report that the U.S. economy faces significant risks of 'stagflation.' Recent developments have reinforced this assessment. The ongoing U.S.-Iran conflict has driven up oil prices, while inflation is increasingly driven by structural factors, potentially leading to persistent inflationary pressures.
Additionally, the impact of artificial intelligence on white-collar jobs is becoming evident, dampening employment growth momentum. Meanwhile, risks in the private credit sector are rising, and if the industry undergoes a clearing phase, financial conditions could tighten, hindering economic growth.
On the policy front, the Federal Reserve faces a dilemma. CICC suggests that the timing for interest rate cuts might be delayed until the latter half of the year. The stimulative effects of tax cuts are partially offset by tariff hikes and increased household savings, potentially resulting in a lower-than-expected boost to the economy.
In this context, U.S. economic growth is expected to slow, with risk premiums in capital markets likely to rise. Consequently, investment strategies may shift from pursuing returns to focusing more on risk aversion.