US inflation, not geopolitics, remains biggest risk to markets in 2026, says this chief investment strategist
LGT Private Banking’s Stefan Hofer cautions that market volatility will be ‘much higher’ this year
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[SINGAPORE] A resurgence in US inflation – rather than geopolitical flashpoints or political rhetoric – poses the biggest threat to financial markets in 2026, said Stefan Hofer, chief investment strategist of LGT Private Banking.
While recent developments, including fresh tensions between the United States and Europe following President Donald Trump’s comments on Greenland, have shaken global markets and weighed on the US dollar, Hofer noted that investors are ultimately guided by economic fundamentals rather than political noise.
In an interview with The Business Times, Hofer explained that the latest market sell-off reflects heightened sensitivity to headlines, but not a fundamental shift in how investors assess risk.
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