Fitch’s 'Neutral' Global Sovereigns Outlook for 2026 📈

• Fitch Ratings projects a ‘Neutral’ 2026 sector outlook for global sovereigns, driven by expectations of broadly flat world GDP growth, reduced uncertainty over US tariffs, and lower policy rates. • Material Risks: Key risks stem from structural shifts in trade, technology, and geopolitics, alongside increasingly stretched public finances in several major economies. • Aggregate government debt is expected to continue rising rapidly, fueled by sizeable budget deficits in the US and China, making fiscal consolidation "painful" for many countries. • GDP Downside: Risks to growth include a renewed trade war, a deepening downturn in China, and financial market shocks. • Political Landscape: Political risks remain prominent, exacerbated by the US-China power rivalry, military conflicts, elections, and domestic strains like inequality and youth employment. • Ratings Stability: Rating Outlooks are broadly stable (10 Positive, 9 Negative). Notably, net upgrades of eight so far in 2025 saw seven of these upgrades applied to emerging markets.