Global economic growth is expected to remain reasonably robust in 2026, but trade policies, geopolitical tensions, and fiscal imbalances pose potential risks, according to a financial rating agency in a comment released today.
The DBRS agency indicates that while fiscal and monetary policies are “positioned to support growth” in 2026, “unresolved fiscal imbalances will eventually harm the credit ratings” of sovereign debts.
Citing “high risks on various fronts,” the agency warns that global trade policy “is likely to be a source of continuous surprises,” noting that “trade protectionism from the US may develop and ultimately stabilize at higher average tariff rates.”
“Although most countries have so far avoided introducing countervailing tariffs, this could also change in the absence of bilateral agreements with affected countries,” it states.
On another note, “ongoing armed conflicts and regional tensions may worsen,” while “large budgetary imbalances in several advanced economies could leave less room for these governments to respond to future recessions.”
“Due to these imminent risks, we enter 2026 with a more neutral outlook,” notes Morningstar DBRS, which on Monday reported three sovereign credit ratings with negative trends and none with positive trends, compared to six with positive trends and only one with a negative trend at the same time last year.
In this context, the agency considers it “unlikely” that the 2026 scenario will repeat this year, where upgrades in sovereign credit ratings outnumbered downgrades.
“However,” it notes, “of our 45 public sovereign credit ratings, 42 have stable trends, which implies that we expect more than 90% of our sovereign credit ratings to remain unchanged over the next 12 months.”
