Artificial intelligence is overheating one part of the economy. The Federal Reserve can only cool all of it.

New Fed Chair Kevin Warsh appears ready to give markets fewer signals. That may give the Fed more flexibility, but it also gives every data point more power to move markets.

The back half of 2026 may hinge on six themes: AI spending, uneven growth, labor supply, sticky inflation, uneasy central banks, and volatile bond markets.

As companies look to bond markets to fund AI investment, the credit impact is showing up in more selective ways, creating opportunities for active investors.

Markets are being tested on several fronts at once. But the important question is how these shocks travel—through inflation, monetary policy, funding conditions, or issuer fundamentals. That’s where resilience begins to diverge.

Even as geopolitical uncertainty clouds growth, attractive yields in high-quality fixed income offer durable return and portfolio resilience.

If inflation isn’t fully broken and growth isn’t overheating, how much risk should fixed income investors take— and where?

The U.S. economy is entering a rolling recovery, with housing and lower-income consumers emerging as the first sectors to benefit.

As investors grapple with the potential for elevated volatility, we offer six themes we think will drive fixed income markets in the first half of the year.

Credit spreads have come off recent tights, but the uncertain macro backdrop continues to favor a selective, patient approach to adding risk.