- David Solomon highlights headwinds from trade policies, sticky inflation, and geopolitics for late 2025 and early 2026.
- Despite these uncertainties, the US economy remains buoyed by fiscal stimulus, AI investments, and deregulation.
- Goldman Sachs (GS) reports a 44% surge in M&A volume to $5.1 trillion in 2025, signaling a robust outlook for capital markets and IPOs in 2026.
Goldman Sachs CEO David Solomon has pointed to lingering uncertainties around trade, inflation, and geopolitics as potential drags on growth in the coming years, even as he expresses overall optimism for the US economy. Speaking in recent discussions, Solomon emphasized that these factors create pauses in capital investment, though they are outweighed by tailwinds such as fiscal stimulus, interest-rate cuts, and an AI infrastructure boom.
According to people familiar with the matter, Solomon's comments reflect a cautious stance among CEOs, who are navigating policy noise and geopolitical tensions. "There is uncertainty around trade, inflation, and geopolitics," Solomon noted, echoing sentiments shared at events like Davos 2026, where business leaders expressed bullishness on investments but nervousness over inconsistent policies. This comes as Goldman Sachs, with over $2.5 trillion in assets under management, reports strong financial performance, including a significant increase in M&A activity.
Efforts to sustain growth have hit a snag in some areas, with sticky inflation impacting consumers and softer labor markets emerging. Without clarity on trade deals, such as potential US-China agreements, companies might delay expansion plans, though Solomon predicts acceleration absent shocks. The Trump administration's deregulatory push and fiscal support, including a summer 2025 bill effective in 2026, are fostering business growth, with a pivot to affordability ahead of midterms.
In parallel developments, industry shifts include a predicted IPO "mega-cycle" and record M&A in 2026, barring exogenous events like cyber threats or escalating geopolitical frictions. Solomon and other experts foresee "one of the best M&A years ever" with stability, contrasting with Europe's slower growth due to regulatory delays. As markets have seen temporary sell-offs, such as those triggered by tariff announcements last April before rebounding, the focus remains on current negotiations and breaking news.
Attempts to reach out for additional comments from Goldman Sachs were not immediately successful. This report may be updated with further details as they emerge.