The Business Times
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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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Vivien Shiao

Vivien Shiao

Published Wed, Jan 21, 2026 · 07:54 PM
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    • Stefan Hofer of LGT says: "We strongly view that in the US, Europe and most advanced economies, there’s going to be a ramping up of infrastructure spending, and that is a great investment opportunity.”
    • Stefan Hofer of LGT says: "We strongly view that in the US, Europe and most advanced economies, there’s going to be a ramping up of infrastructure spending, and that is a great investment opportunity.” PHOTO: LGT PRIVATE BANKING

    [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.

    Investment outlookOutlook 2026Trump tariffsUS inflationGreenland

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