Davos 2026: AI, gold, cryptos in focus as WEF economists warn of global market risks
According to the WEF Chief Economists’ Outlook, growth prospects continue to diverge sharply by region. South Asia stands out as the strongest performer, with 66% of economists expecting strong or very strong growth, driven largely by India. East Asia and the Pacific are expected to post moderate to strong growth.
- Jan 17, 2026,
- Updated Jan 17, 2026 12:51 PM IST
The global economic outlook has improved slightly but remains clouded by significant risks, including elevated asset valuations, rising sovereign debt and growing geoeconomic fragmentation, according to the World Economic Forum’s (WEF) latest Chief Economists’ Outlook released on Thursday.
The survey of chief economists from the public and private sectors shows that 53% now expect global economic conditions to weaken over the next year, a notable improvement from the 72% who held that view in September 2025. While this shift points to greater resilience amid recent shocks, economists caution that uncertainty remains high as structural challenges intensify.
“The Chief Economists survey reveals three defining trends for 2026: surging AI investment and its implications for the global economy; debt approaching critical thresholds with unprecedented shifts in fiscal and monetary policies; and trade realignments,” said Saadia Zahidi, Managing Director at the World Economic Forum. She added that governments and businesses will need to manage near-term uncertainty while continuing to invest in long-term growth fundamentals.
AI and asset prices under scrutiny
Asset valuations—particularly those linked to artificial intelligence—are a major source of concern. Concentrated gains in AI-related stocks have divided economists, with a narrow majority of 52% expecting AI-linked US equities to decline over the next year, while 40% foresee further gains. Should a sharp correction occur, 74% of respondents believe it would have ripple effects across the global economy.
Other asset classes face a weaker outlook. Cryptocurrencies appear especially vulnerable, with 62% of economists expecting further declines following recent market volatility. Meanwhile, 54% believe gold prices may have peaked after recent rallies, suggesting limited upside ahead.
Despite near-term valuation concerns, confidence in AI’s productivity potential remains strong. Nearly four in five chief economists expect meaningful productivity gains within two years in the US and China. The information technology sector is expected to be the fastest adopter, followed by financial services, supply chains, healthcare, engineering and retail. Larger firms are likely to benefit sooner, with 77% of economists anticipating productivity gains within two years for companies with more than 1,000 employees.
Employment and AI transition
The labour market impact of AI is expected to evolve over time. About two-thirds of respondents foresee modest job losses over the next two years. Over a longer horizon, views diverge, with 57% anticipating net job losses over the next decade, while 32% expect gains as new roles and occupations emerge alongside technological change.
Debt pressures
Managing elevated public debt is emerging as a central challenge for policymakers. Nearly one-third of economists are concerned about the risk of sovereign debt crises in advanced economies, while almost half see such risks in emerging markets. A large majority expect governments to rely on higher inflation and increased tax revenues to manage debt burdens.
Spending priorities are also shifting. Defence expenditure is widely expected to rise, with 97% of economists forecasting increases in advanced economies and 74% in emerging markets. Digital infrastructure and energy spending are also expected to grow, while environmental protection spending is likely to decline in both advanced and emerging economies.
Trade realignment and uneven growth
Global trade and investment are adjusting to a more competitive and fragmented environment. Most economists expect US-China tariffs to remain broadly stable, but restrictions on technology exports and critical minerals are likely to persist or intensify. Bilateral and regional trade agreements are expected to become more prominent.
Growth prospects vary sharply by region. South Asia leads the outlook, with 66% of economists anticipating strong or very strong growth, driven largely by India. East Asia and the Pacific are expected to see moderate to strong growth, while Europe faces the weakest outlook, with more than half of respondents expecting weak growth in the year ahead.
The report underscores a global economy that is holding up better than expected, but one that remains vulnerable to financial, technological and geopolitical shocks.
The global economic outlook has improved slightly but remains clouded by significant risks, including elevated asset valuations, rising sovereign debt and growing geoeconomic fragmentation, according to the World Economic Forum’s (WEF) latest Chief Economists’ Outlook released on Thursday.
The survey of chief economists from the public and private sectors shows that 53% now expect global economic conditions to weaken over the next year, a notable improvement from the 72% who held that view in September 2025. While this shift points to greater resilience amid recent shocks, economists caution that uncertainty remains high as structural challenges intensify.
“The Chief Economists survey reveals three defining trends for 2026: surging AI investment and its implications for the global economy; debt approaching critical thresholds with unprecedented shifts in fiscal and monetary policies; and trade realignments,” said Saadia Zahidi, Managing Director at the World Economic Forum. She added that governments and businesses will need to manage near-term uncertainty while continuing to invest in long-term growth fundamentals.
AI and asset prices under scrutiny
Asset valuations—particularly those linked to artificial intelligence—are a major source of concern. Concentrated gains in AI-related stocks have divided economists, with a narrow majority of 52% expecting AI-linked US equities to decline over the next year, while 40% foresee further gains. Should a sharp correction occur, 74% of respondents believe it would have ripple effects across the global economy.
Other asset classes face a weaker outlook. Cryptocurrencies appear especially vulnerable, with 62% of economists expecting further declines following recent market volatility. Meanwhile, 54% believe gold prices may have peaked after recent rallies, suggesting limited upside ahead.
Despite near-term valuation concerns, confidence in AI’s productivity potential remains strong. Nearly four in five chief economists expect meaningful productivity gains within two years in the US and China. The information technology sector is expected to be the fastest adopter, followed by financial services, supply chains, healthcare, engineering and retail. Larger firms are likely to benefit sooner, with 77% of economists anticipating productivity gains within two years for companies with more than 1,000 employees.
Employment and AI transition
The labour market impact of AI is expected to evolve over time. About two-thirds of respondents foresee modest job losses over the next two years. Over a longer horizon, views diverge, with 57% anticipating net job losses over the next decade, while 32% expect gains as new roles and occupations emerge alongside technological change.
Debt pressures
Managing elevated public debt is emerging as a central challenge for policymakers. Nearly one-third of economists are concerned about the risk of sovereign debt crises in advanced economies, while almost half see such risks in emerging markets. A large majority expect governments to rely on higher inflation and increased tax revenues to manage debt burdens.
Spending priorities are also shifting. Defence expenditure is widely expected to rise, with 97% of economists forecasting increases in advanced economies and 74% in emerging markets. Digital infrastructure and energy spending are also expected to grow, while environmental protection spending is likely to decline in both advanced and emerging economies.
Trade realignment and uneven growth
Global trade and investment are adjusting to a more competitive and fragmented environment. Most economists expect US-China tariffs to remain broadly stable, but restrictions on technology exports and critical minerals are likely to persist or intensify. Bilateral and regional trade agreements are expected to become more prominent.
Growth prospects vary sharply by region. South Asia leads the outlook, with 66% of economists anticipating strong or very strong growth, driven largely by India. East Asia and the Pacific are expected to see moderate to strong growth, while Europe faces the weakest outlook, with more than half of respondents expecting weak growth in the year ahead.
The report underscores a global economy that is holding up better than expected, but one that remains vulnerable to financial, technological and geopolitical shocks.