Global bond yields have hit their highest levels since 2009 as traders scale back expectations for further easing, with markets now pricing virtually no additional cuts from the European Central Bank and renewed tightening in Japan and Australia. Long-dated US Treasury yields also climbed ahead of the Federal Reserve's expected cut, reflecting concerns over inflation persistence, fiscal deficits, and uncertainty surrounding the next Fed chair.

Neuberger's investment leaders break down the macro environment and its implications for equities, fixed income, and private markets. We distill this into five key themes to help you evaluate risk and opportunity in the year ahead.

Private lenders have deployed a record $18 billion into emerging markets this year as shrinking bank appetite in Africa, Latin America and beyond opens space for alternative financiers. Unlike the stressed US private-credit sector, emerging-market deals carry lower leverage, tighter covenants and far higher yields, often above 15-20%. Managers say high local rates and conservative structures echo the early days of private credit, drawing global investors seeking diversification and stronger protections.

Asian investors are sharply increasing allocations to Gulf bonds and loans as they diversify away from US assets and seek higher yields and stronger growth prospects. Gulf issuance has surged, with Asian buyers now taking 15-20% of new deals, up from 5-7% last year, helped by deepening trade ties, attractive spreads and growing comfort with the region's credit quality.

Bank of England officials have signaled widening divisions ahead of next week's policy meeting, with deputy governor Clare Lombardelli warning of "upside risks" to inflation and urging caution on further cuts despite Budget measures expected to reduce price pressures. Several Monetary Policy Committee members, including Catherine Mann, echoed concerns about lingering inflation, while others such as Dave Ramsden argued the bank can proceed with easing as disinflation strengthens. Governor Andrew Bailey is seen as the swing vote as markets price in a quarter-point cut.

Paramount's $77.9 billion hostile bid for Warner Bros. Discovery, backed by $54 billion in bank and private-credit financing, underscores a resurgence in massive, debt-fueled deals even as credit markets flash signs of exuberance. Bond investors are reportedly growing uneasy as leverage piles up on transactions such as Paramount-Warner and the $55 billion leveraged buyout of Electronic Arts, recalling past hung deals like Twitter's financing and warning that ambitious cost-cut targets and investment-grade promises often fail to survive contact with reality.

London Stock Exchange chief executive Julia Hoggett dismissed claims that the UK's capital markets are in decline, arguing negative sentiment is largely a "media narrative" and pointing to London's ninth-place global ranking for capital raised this year. Her remarks come despite a drop in IPO activity, high-profile departures and London falling out of the top 20 listing venues. Hoggett said the updated listings regime leaves the market "fit for the future" and insisted London remains Europe's leading capital-raising hub.

Bank of Korea board member Kim Jong-hwa said that authorities "can't sit and do nothing" as the won nears a 16-year low, warning the currency's decline risks reviving inflation and hurting unhedged exporters. The remarks come as South Korea's rate gap with the US sits at its widest since 1999 and policymakers explore FX-stabilization steps, including dollar-raising options at the National Pension Service.

Clearinghouses say the European Securities and Markets Authority's final technical standards under Emir 3.0 remain highly prescriptive and could slow model updates and new product launches, despite tweaks intended to ease the burden. Although ESMA raised the threshold for "significant" model changes to a 20% impact on prefunded resources and exempted shifts toward more conservative margining, CCPs argue the regime still creates heavy administrative work and contrasts with the US' more flexible self-certification approach.

President Donald Trump plans to conduct final interviews this week with candidates for Federal Reserve chair, including former governor Kevin Warsh and National Economic Council director Kevin Hassett, after abruptly canceling sessions last week. Treasury Secretary Scott Bessent has narrowed the field to five contenders, signaling the job isn't locked up as Trump weighs a successor to Chair Jerome Powell, who is expected to deliver another rate cut Wednesday.

The International Monetary Fund urged China to speed structural reforms and shift toward consumption-led growth, warning that reliance on debt-fueled investment and exports is increasingly untenable amid global trade tensions. The IMF raised its 2025 growth forecast to 5% and 2026 to 4.5%, but said property-sector weakness, local government debt, and subdued domestic demand continue to challenge policymakers.

SIFMA recently published the results of its year-end survey and held a briefing to discuss the findings. The survey assessed what's driving growth, what's slowing it, and what may lie ahead for markets, policy, and investor sentiment. In this post, BMO's Scott Anderson offers an overview of SIFMA's year-end Economist Roundtable survey, highlighting stronger 2026 growth expectations driven by AI investment, resilient consumer spending, and easing tariff pressures. He also underscores key risks ahead, including a softening labor market, elevated inflation, and uncertainty around monetary policy and market performance.