Bank of America’s 2026 market forecast indicates robust global growth, primarily fueled by AI investments, yet it cautions that volatility may increase as investors begin to comprehend the technology’s broader economic impact.
The bank’s global research team anticipates U.S. GDP growth of 2.4% year-over-year by the end of 2026, outperforming consensus estimates, primarily due to business investment, fiscal stimulus, and recent interest rate reductions. China’s growth is also expected to exceed forecasts, with projections of 4.7% for 2026 and 4.5% in 2027.
Artificial intelligence is the most significant element influencing the bank’s outlook.
The rise in AI expenditures is currently boosting GDP, and BofA does not foresee a bubble at this stage. “We are optimistic about the two most significant economies,” stated Candace Browning, head of BofA global research. “Fears of an impending AI bubble are exaggerated.” The report indicates that AI-related capital investment is set to accelerate further next year, potentially initiating a new investment cycle.
Bitcoin miners profited from the AI surge in 2025, as growing demand for high-performance computing has enhanced the value of their infrastructure. Several publicly traded mining companies have reported revenue increases this year not only from mining but also from leasing data center capacities to AI firms in need of GPU resources.
IREN (IREN) has surged 337.15% year-to-date, while Cipher Mining (CIFR) has nearly tripled in value. TeraWulf (WULF) has increased by 190% during the same timeframe. These gains occurred despite Bitcoin not making a significant breakout, continuing to hover around the $90,000 mark.
In summary, markets are evolving from a consumption-driven recovery to one focused on capital expenditure, infrastructure, and productivity. If this trend persists, it could extend beyond traditional equities and into sectors like digital infrastructure, blockchain, and data monetization—areas where crypto projects have made their mark.
Nonetheless, the bank anticipates challenges ahead. As investors and policymakers gain clarity on how AI impacts inflation, labor markets, and supply chains, financial markets might undergo significant fluctuations. BofA cautions that the prevailing “K-shaped” recovery, where certain sectors thrive while others lag, adds layers of complexity to this outlook.
This divergence could worsen if AI enhances productivity in technology and finance, leaving slower sectors behind. The outcome may be a dual-speed economy that becomes harder to navigate with conventional measures. For markets, this raises the likelihood of mispricing and sudden revaluations.
Emerging markets might gain in the short term, particularly if the U.S. dollar weakens and oil prices remain low. BofA observes that these regions are likely to experience stronger performance in 2026, bolstered by global monetary easing. For some developing nations that have bypassed traditional infrastructure in favor of digital systems, the rising demand for AI could open opportunities for alternative technologies.
However, the overall tone of the report remains cautiously optimistic. With two Fed interest rate cuts predicted in 2026 and fiscal policies remaining expansive, the economic environment seems supportive for now.
In a year where copper prices are climbing due to supply constraints and fiscal expansion, and S&P earnings are projected to rise by 14% amidst subdued price increases, the market appears ripe for change. Whether AI serves as a driver of productivity or a source of instability could pose one of the key questions for the coming twelve months.
In this discussion, crypto—particularly in its more infrastructure-oriented forms—may play a role, even if it’s not yet at the forefront of the conversation.
