The Forward Look—European and UK Credit Views: Q4 2026
Key Takeaways
Competing themes fighting for the outlook, from geopolitics to artificial intelligence (AI).
Inflation risks holding back growth and expansion.
AI build-out provides both economic stimulus and inflationary forces while also raising market concerns.
Spreads have moved wider, offering opportunity for dispersion strategies and providing attractive relative comparisons.
Forward View
Growth Outlook: Competing Forces
Growth across various European economies continues to beat expectations. The outright level of growth is not strong, and as usual, it is not universal in its progression. However, it is outperforming and proving to be resilient in the face of several headwinds. Competing forces are playing a role in the development of economic growth in Europe. Driving forward progress is the slow but expansionary turnaround in Germany, Spanish momentum, and an ongoing AI, defence, and capex spending cycle. However, on the flip side,…
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