KKR Releases 2026 Mid-Year Global Macro Outlook
Henry McVey: The Cycle Continues, But the “Divergence Conundrum” Is Intensifying
KKR, a leading global investment firm, today released “The Divergence Conundrum,” the 2026 Mid-Year Global Macro Outlook by Henry McVey, CIO of KKR’s Balance Sheet and Head of Global Macro and Asset Allocation (GMAA).
In the report, McVey and his team argue that the global economy is still expanding, but doing so unevenly as it enters a period of intensifying divergence. “The cycle is not over, but it is becoming more selective,” McVey writes, as the team sees economic gains becoming increasingly concentrated and creating wider dispersion across regions, industries, and asset classes. Drawing on historical parallels to the 1870s, 1920s, and late 1990s, McVey and his team argue that periods of elevated divergence are not unprecedented, though today’s version may be broader in scope.
They call this environment the “Divergence Conundrum”: a market and macro backdrop in which a broadening productivity boom is extending the cycle even as geopolitical fragmentation, energy security concerns, and strategic competition contribute to a higher resting heart rate for inflation. In their view, this combination will be increasingly difficult for central banks to navigate as economies move away from the efficiency-first model that defined much of the pre-COVID era and toward one that places a greater premium on resilience, redundancy, and control.
