Robeco sees AI-driven productivity rising, yet constrained by energy, policy, and geopolitical limits. Three scenarios highlight opportunities in emerging markets, commodities, and strategic hedges.
Inspired by the contradictions of the historical Renaissance, Robeco’s outlook sees a world where AI systems evolve rapidly, yet their transformative impact is constrained by energy limitations, policy incoherence, and geopolitical fragmentation. The report introduces the concept of the ‘digital Da Vinci’, highlighting how AI agents are poised to revolutionize productivity, even as macro headwinds temper their full potential.
Peter van der Welle, Strategist Multi-Asset Solutions at Robeco: “While AI promises a renaissance in productivity, we believe this revival will appear stale upon closer inspection. Structural inhibitors – from constrained monetary policy to geopolitical restraint – will limit the breadth of economic gains.”
Laurens Swinkels, Head of Solutions Research at Robeco: “In a world where paradox abounds, great inventions will still emerge. Investors must look beyond traditional assets and embrace unloved hedges like commodities and Real Estate Investment Trusts to navigate the coming years. Diversification and strategic hedging will be key.”
Key headwinds
Robeco’s outlook identifies four major headwinds that could inhibit the vitality of this technological renaissance. First, conflicted supremacy reflects the growing challenges to US leadership, which is increasingly hampered by internal policy inconsistencies and rising global skepticism. Second, contained escalation describes a geopolitical environment marked by strategic restraint, where tensions – such as the US-China trade war – remain unresolved but do not escalate into full-blown conflict.
Third, constrained normalisation points to persistent inflation levels that exceed central bank targets, thereby limiting the flexibility of monetary policy. Finally, conditional sustainability captures the evolving nature of climate finance, which is shifting from idealistic ambitions to a more pragmatic focus on measurable impact and accountability. These cyclical challenges are underpinned by deeper structural forces, including persistent labor market challenges, rising sovereign debt, and the erosion of the US dollar’s global dominance.
Base case: The Stale Renaissance (50% probability)
Robeco’s central scenario anticipates moderate global growth, with US real GDP expanding at 2.1% annually. Meanwhile, the eurozone, Japan, and emerging markets are expected to improve their relative growth positions. Inflation in developed markets is forecast to average 2.5%, with the US slightly higher at 2.75% due to falling immigration and rising tariffs. Despite technological progress, policy incoherence and populism are expected to dampen investor confidence and capital flows.
Bull case: The Luminous Renaissance (15% probability)
In this optimistic scenario, AI adoption accelerates across industries, removing barriers to productivity and enabling a synchronized global upswing. Inflation remains at target levels, and geopolitical tensions ease, potentially reviving globalization. Real GDP growth could exceed trend levels, with broad-based investment opportunities emerging.
Bear case: The Exorbitant Decay (35% probability)
This scenario envisions a breakdown of global economic institutions and principles. US policy incoherence undermines the dollar’s dominance, triggering stagflation and fiscal dominance. Trade wars and geopolitical instability lead to a security premium replacing the peace dividend, with central bank independence eroding.
Expected Returns 2026-2030 (Base case)
Investment implications
Robeco expects a more concentrated and momentum-driven market, with fewer asset classes delivering above-average risk premiums. Valuations for US equities and high yield bonds appear stretched, suggesting elevated downside risks. In contrast, emerging market assets – particularly debt in hard currency – are projected to offer strong relative returns. Investors should prepare for a more selective environment, where thoughtful allocation and scenario-based planning are key to navigating uncertainty and capturing long-term value.
Special topics
This year’s report also features four special topics that reflect the evolving investment landscape:
- ‘Artificial intelligence for small-cap stock selection’, showcasing how machine learning can uncover alpha in under-researched segments.
- ‘What to do when safe havens turn into stormy waters?’, analyzing the shifting role of sovereign debt amid rising fiscal risks.
- ‘A liquid alternative to private equity’, exploring how public markets can replicate private equity returns with greater liquidity and sustainability integration.
- ‘Staying the course on sustainable investing’, reaffirming the long-term value of stewardship, net-zero commitments, and resilience in a polarized world.
