JPMorgan’s View of 2026: Economic Divergence, Policy Divergence, and Soaring AI Adoption Rates

JPMorgan Releases Annual Outlook Report, Predicts 2026 Global Markets to Be Reshaped by Monetary Policy Divergence, Soaring AI Adoption, and Multi-dimensional Market and Economic Divergence; Sets S&P 500 Target at 7,500 Points and Gold at $5,000

This article is sourced from Wallstreetcn and organized, translated, and written by Foresight News.
(Previously: JPMorgan Calls for Bitcoin to Hit $170,000 Next Year, Closely Watching MicroStrategy mNAV 1 Redline in the Short Term)
(Background: JPMorgan: AI Supercycle Drives S&P 500 Index to Potential 17% Growth by 2026)

AI Drives Capex Expansion, but Consumption Shows a “K-Shaped” Trend

According to JPMorgan’s annual outlook report released on the 5th, the global market in 2026 will be profoundly reshaped by three core forces: unequal monetary policy, a surge in AI adoption, and increasingly intense multi-dimensional market and economic divergence.

According to Chasing Wind Trading Desk, despite the complex overall environment, JPMorgan remains bullish on global equities and sets a 2026 year-end S&P 500 target at 7,500 points. Strategists believe the “AI supercycle” is driving record capital expenditure and earnings expansion, which will be the most crucial investment theme for the coming year. If the Fed further eases policy due to improving inflation, the S&P 500 could even break through 8,000 points in 2026. As of press time, S&P 500 futures were up 0.19 to 6,870 points.

On monetary policy, JPMorgan predicts the Fed will cut rates by 25 basis points each in December this year and January next year, then pause, maintaining this “asymmetric bias” through the first half of 2026. This policy path will lead to sharp divergence among developed market central banks: aside from the Fed and Bank of England expected to cut rates, central banks in the Eurozone, Scandinavia, and Australia are expected to hold steady in 2026. This divergence is expected to pressure the dollar, though its decline will be limited by the relative strength of the US economy.

JPMorgan’s global market strategy team emphasizes that 2026 will feature “multi-dimensional polarization”: equity markets will diverge between AI and non-AI sectors, the US economy will diverge between strong capex and weak labor demand, and consumption will exhibit an unhealthy “K-shaped” pattern.

AI Supercycle & Economic Divergence

JPMorgan sees 2026 not only as a year of surging AI adoption but also as a pivotal period for reshaping investment, productivity, and industry leadership. The ongoing expansion of AI is fueling a global capex boom. The report notes that despite labor challenges in some US sectors, corporate investment is being strongly driven by AI trends. The bank believes AI industry momentum is spreading geographically and across sectors, expanding from technology and utilities to banking, healthcare, and logistics.

This tech-driven growth is also widening internal economic rifts. JPMorgan describes a “K-shaped economy,” with robust corporate capex and sharply divided household consumption. While the new US government’s deregulation agenda may unleash fresh business vitality, tariff impacts may be staggered, and productivity gains from AI plus falling energy prices will partially offset tariff-driven inflation.

On economic growth, JPMorgan projects global GDP growth at 2.5% in 2026, roughly flat versus 2.7% in 2025. US GDP growth is forecast to hold at 2.0%, with the Eurozone dropping to 1.3%. The report points out global growth prospects remain resilient, mainly due to loose monetary and fiscal policies and waning market concerns over US policy. The bank expects US inflation to remain sticky, with core PCE inflation edging up from 3.0% in 2025 to 3.1% in 2026.

The “synchronization” of monetary policy is a thing of the past. JPMorgan expects easing in developed markets to be highly uneven. After completing “insurance cuts,” the Fed’s neutral rate is expected to stabilize around 3%. By contrast, the Bank of England is expected to cut rates further in December 2025 and March and June 2026. In the Eurozone and Japan, policy rates are expected to face different pressures, especially as the Bank of Japan remains cautious, though yen rates still face upward pressure.

Cross-Asset Strategy: Bearish on Oil, Extremely Bullish on Gold

Based on the above macro view, JPMorgan presents strong cross-asset allocation stances:

Bonds & Rates: US 10-year Treasury yields are expected to first dip then rise, with a mid-year target of 4.25% and year-end at 4.35%. Given the Fed is expected to pause rate cuts, strategists recommend underweighting the belly of the US Treasury curve (2-year/5-year/10-year).

FX: Remain bearish on the dollar, seeing the Fed’s asymmetric policy tilt in H1 2026 capping dollar strength. The bank is bearish on the yen, expecting USD/JPY to rise to 164 in Q4 2026. In emerging markets, the bank favors high-yielders like the Brazilian real (BRL), Mexican peso (MXN), and South African rand (ZAR).

Commodities: JPMorgan is bearish on oil, expecting supply-demand imbalances to drive prices lower, with Brent crude averaging only $58/barrel in 2026. Conversely, the bank remains structurally bullish on precious metals, setting a stunning $5,000/oz gold target for Q4 2026, and is also bullish on silver, copper (mainly driven by AI electricity demand), and aluminum.

JPMorgan lists key scenario assumptions. In the optimistic “upside risk” scenario, the AI theme broadens further or there is “immaculate disinflation”—productivity gains offset inflation pressures, allowing the Fed to normalize rates. Additionally, if the US government eases regulation or global fiscal stimulus creates multiplier effects, this could drive above-expectation economic growth.

In the negative “downside risk” scenario, main threats include a true macro slowdown, market skepticism of AI causing tech stock pullbacks, and sudden Fed policy shifts. Especially if sticky inflation forces the Fed to abandon its asymmetric bias and turn hawkish, this could tighten liquidity and hit high-beta assets.

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This article “JPMorgan’s View of 2026: Economic Divergence, Policy Divergence, Soaring AI Adoption” was first published on BlockTempo, the most influential blockchain news media.