Power of endurance

The first half of 2026 has reinforced our view that this is not a standard late-cycle environment. Growth is slowing unevenly, inflation risk is rising, and fiscal policy is becoming a more visible constraint. Geopolitical shocks are increasingly affecting energy prices, shipping routes, food and fertiliser costs, and corporate margins, while artificial intelligence (AI) continues to be a strong earnings driver across regions and, increasingly, across sectors. The next six months will test the endurance of our scenario, which assumes a fragile de-escalation of the Middle East crisis and a reopening of the Strait of Hormuz, although the path to a stable deal remains uncertain.

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Monica Defend

Monica Defend

Head of Amundi Investment Institute

Building portfolios for a world where money is political, inflation is more volatile, and concentration is more expensive will be key. In this new regime, the best portfolios can withstand different scenarios: they need to be diversified across currencies, invested in real assets and gold, and explore equity sector opportunities and structural themes.

Monica Defend, Head of Amundi Investment Institute

Four key themes will be particularly important for investors: the resilience of the global economy to the energy shock, the credibility of policy response in a world of higher debt and constrained central banks, the political implications of the US mid-term elections as markets start to price the next phase of fiscal and regulatory choices and the continued broadening of the AI supercycle.

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Vincent Mortier

Vincent Mortier

Group CIO

As the AI story shifts from who can build the frontier to who can scale it, investing will be about seeking breadth across the full value chain and diversifying against technological, geopolitical and physical risks.

Vincent Mortier, Group CIO

Testing the limits of economic resilience

The global economy has so far displayed resilience in the face of the Middle East conflict, which boosted oil prices to the detriment of inflation. The repeated shocks of recent years, notably from geopolitical events, have forced companies and policymakers to become more agile. Their adaptability may mitigate the risk of recession in the coming quarters. But much hinges on how long it will take to repair oil supply disruptions and the vulnerabilities they expose.

Macro/Financial scenarios and probabilities

Main Scenario - 60%

Upside Scenario - 15%

Downside Scenario - 25%

Fragile de-escalation, broadening of AI adoption
 

 

Energy risk repriced, recession avoided 

  • Oil higher than previously assumed but no significant spike. 
  • Growth revised lower (notably Europe) but no recession. 
  • Cautious central banks; hikes possible but do not expect a full hiking cycle.

 

Market implications: Stay risk-on, with protection: strong EPS growth, decent liquidity. Selective on Europe, Asia, real assets, commodities insurance.

Credible settlement and clearer Strait reopening, AI virtuous cycle

 

De-escalation, disinflation and rising confidence

Normal in/outbound Strait of Hormuz traffic, paving the way for clearer easing cycle for central banks. 

 

Market implications: Increase risk exposure. Favour cyclicals, Europe, EM assets, Asia and energy importers; bonds supported as inflation fears ease. 

Re-escalation, failed deal implementation, or an AI hard landing

 

Macro/financial shock and global recession risk

Oil moves far above assumptions; inflation expectations become less anchored, pushing central banks to hike further in 2026 and/or disappointment in AI/tech leads to a market correction.
 

Market implications: Risk-off pivot; lower quality creditunder pressure, high premia on govies with scarce fiscal discipline. Favour cash, short-term rates in the US and safe-haven currencies (CHF, USD). 

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Philippe D’Orgeval

Philippe D’Orgeval

Vice Group Chief Investment Officer

Europe’s long-term opportunities outweigh the short-term challenges. Defence and security spending, alongside investment in electrification and AI infrastructure, are clear areas of momentum as Europe pivots towards strategic autonomy. Private markets are also seeing substantial capital flows, marking another long-term growth story.

Philippe D’Orgeval, Vice Group Chief Investment Officer

Portfolio construction in an inflationary era

With the last major inflation shock in 2022, H1 2026 has provided another example of renewed inflationary pressure, this time driven by an energy supply shock stemming from the conflict in Iran. These episodes confirm our long-term view that inflation is becoming more structural and less linear, driven by geopolitical fragmentation, stronger commodity demand linked to the green transition, AI and infrastructure and repeated supply-side disruptions. While 2022 was an extreme event, with inflation fuelled by a powerful mix of pandemic-era stimulus, supply chain bottlenecks and rising energy prices, 2026 is not an extreme inflation shock, although it still marks a meaningful shift compared to our original assumption of a normal inflationary backdrop. 
 

Historical performance of main asset classes under different inflation regimes
 

Historical performance of main asset classes under different inflation regimes

 

Source: Amundi Investment Institute, Bloomberg. Data as of 15 June 2026. For illustrative purposes. 
 

In H2 2026, if the global economy remains resilient in an inflationary environment, then it calls for maintaining exposure to risk assets with stronger hedges. In equities, the most inflation-resilient areas are in industrials, infrastructure, and companies with strong pricing power. In fixed income, carry appears preferable to duration. We also believe that gold and commodities more broadly will play a more reliable role in portfolio diversification to enhance resilience.


Inflationary regime matters: asset class performance changes materially when the regime moves from normal to inflationary and cash becomes a structural decision. Gold and commodities have historically offered stronger relative performance, while the role of bonds depends on the source and persistence of inflation. 

Looking ahead, what are the main investment themes for H2 2026?

Increase focus on the real economy, real assets, commodities, and infrastructure as stores of value at a time of higher risk of value erosion from inflation.

Europe’s strategic autonomy agenda is becoming a multi-year investment cycle across defence, energy security, AI infrastructure and industrial renewal.

Higher inflation, geopolitical volatility and USD debasement are key risks. Duration alone is not enough. A broad protection toolkit includes gold, FX, alternative investments, and hedging strategies.

AI remains a structural equity driver, but avoiding concentration risk will be key. Look to a broader opportunity set from infra providers to AI adopters across sectors and regions.

Higher yields have made bonds more appealing, but with debt high and policy paths unclear, flexibility is key to capturing bond income.

Favour countries that are supply-chain winners, commodity exporters, or those with credible policy frameworks. Be cautious where dollar sensitivity is high and external balances are weak.
 

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