Is 2026 the start of the world’s next consumer super-cycle?

FOR much of the past decade, global equity markets have revolved around US mega-cap technology companies and the American consumer.

But while Wall Street captured the spotlight, something quieter and yet potentially more transformative has been taking shape across the Pacific.

The Asian middle class is staging a comeback. Structural and cyclical forces are converging across China, Japan, India and South-east Asia, with early signals already emerging throughout 2025.

However, 2026 may prove to be the inflexion point as these nascent trends crystallise into the world’s next major consumer super-cycle.

The Organisation for Economic Co-operation and Development (OECD) projects that 65 per cent of the global middle class, or some 3.5 billion people, will live in Asia by 2030; this demographic shift represents unprecedented spending power poised to reshape global markets.

For investors, this isn’t merely an equity story. It’s a currency story too.

China’s cautious consumer returns

China’s consumer is back, but the playbook has changed. After years of property market turmoil, Chinese households are shifting toward value-oriented consumption and experiential spending.

This “rational consumption” trend positions Pinduoduo’s group-buying model to benefit, while Alibaba faces headwinds as consumers pull back on premium goods.

Beijing’s policy pivot toward direct household income support – including 300 billion yuan in ultra-long treasury bonds for consumer trade-in programmes – provides a more sustainable foundation for spending growth.

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Critically, China’s central bank has emphasised that yuan stability is “key to global financial and economic stability”.

For Chinese households, yuan stabilisation reduces currency-related anxiety. This is a powerful psychological catalyst that historically unlocks discretionary spending among middle-class savers.

Yuan stability builds consumer confidence, and a stable yuan backdrop supports the consumption pivot Beijing desperately needs.

Japan’s wage renaissance

Perhaps the most remarkable development in Asia is unfolding in Japan, where real wages turned positive in July 2025 for the first time in seven months. This marked a watershed moment for an economy that has endured wage stagnation since the 1990s.

Consumer spending has risen for three consecutive months, with robust wage growth exceeding 5 per cent in major firms boosting disposable income. Domestic demand is now the main driver of Japanese growth, with the OECD projecting real GDP growth of 0.7 per cent in 2025.

The yen has weakened substantially, pressured by slow Bank of Japan normalisation. But if domestic demand continues to strengthen, the case for a yen reversal becomes increasingly credible.

Long yen represents a contrarian, high-conviction opportunity: Japan’s domestic consumption renaissance could drive a powerful rerating, with gradual yen recovery amplifying purchasing power gains.

Regional divergence: India and Indonesia

India remains on a strong demographic and consumption trajectory, with its expanding middle class set for a tourism and travel boom as incomes rise. The rupee benefits from relatively stable fundamentals.

Indonesia presents a cautionary tale. According to the latest figures from the country’s Central Bureau of Statistics, the middle class has contracted by nearly 9.5 million people over the past five years.

In 2019, about 57.3 million Indonesians – 21.4 per cent of the population – were classified as middle class. By 2024, that number had declined to 47.9 million, or just 17.1 per cent, reflecting a structural erosion of purchasing power – even amid steady headline growth.

Preliminary reports and analysis from late 2025 indicate this group remains under pressure due to wage stagnation and inflation. The Indian rupee offers carry with structural stability, while the rupiah faces headwinds from weakening domestic consumption, a reminder that currency and consumer strength don’t always move in lockstep.

Intra-Asia travel boom

One of the most tangible expressions of Asia’s consumer resurgence is the explosion in intra-regional travel. Chinese outbound bookings surged with a 25 per cent year-on-year increase in outbound travel, with strong demand for South-east Asia.

Tourism functions as a consumption multiplier impacting airlines, hotels, retail and entertainment. For Thailand, this represents a structural tailwind extending well beyond 2025.

The Thai baht is the purest tourism beta play in Asia; as Chinese tourists return and intra-regional travel accelerates, baht strength becomes a direct expression of rising Asian consumer mobility.

Underpinning all this is South-east Asia’s digital-payment revolution. The region is now the world’s fastest-growing market for mobile wallets, with active accounts forecast to reach 440 million by 2025. More than 60 per cent of transactions are now digital, exceeding many Western markets.

This infrastructure accelerates transaction velocity, deepens e-commerce penetration and creates valuable data ecosystems. Companies such as Grab and Sea are positioned at the intersection of payments, e-commerce and consumer finance, benefiting from rising cross-border flows and stronger regional currencies.

A new engine for global growth

The US consumer has been the world’s growth engine for decades. Europe is stagnating. China’s real estate model is exhausted.

But a new narrative is emerging: one built on rising wages, digital infrastructure, cross-border mobility and billions of people moving into higher income brackets.

The next global bull market may be driven by 3.5 billion Asians earning more, travelling more and spending more. For investors, the opportunity spans both equities and currencies, with positions in the yen, yuan, baht, Singapore dollar and Indian rupee serving as direct expressions of the Asian consumer super-cycle thesis.

The US tech story dominated the last decade. The next big global megatrend may be simpler: the Asian middle class reclaiming its place at the centre of global growth.

The writer is institutional business development manager, CMC Markets Singapore