Temasek International’s investment chief says the biggest risks to global markets in 2027 are a potential reversal of the AI-driven trade and the impact of inflation on interest rates. Bloomberg reports that the risk is not only continued inflation, but also the possibility that inflation pushes bond yields higher enough to stall or end the recent equity rally.
Quartz adds detail on what could cause an AI trade unwind, citing scenarios such as heightened safety concerns, tighter regulation, or weaker-than-expected returns. Together, the outlets present the warning as a combination of market-structure and policy risks: AI investment momentum could cool, while inflation could keep borrowing costs elevated, influencing investor expectations for stocks and bonds.
