Halfway through the year, the picture that emerges from global markets is one of grinding adjustment rather than rupture. Growth has slowed in most advanced economies without collapsing, and labour markets have loosened at the edges instead of cracking.
For central banks the question is no longer whether inflation is falling but whether it is falling for durable reasons. Services prices, which move slowly and reflect wages more than commodities, remain the stubborn component in almost every dataset.
Investors have responded by concentrating risk in a narrow band of large companies, which flatters index returns while masking weakness elsewhere. Breadth, not headline levels, is the number worth watching in the second half.
None of this rules out a sharper turn. It does suggest that the base case for the rest of 2026 is a slow, uneven normalisation punctuated by policy surprises.
