Inner Circle

Welcome to this month's investment insights

Welcome to the monthly investment strategy report for October 2026, where Macquarie Wealth Management Chief Investment Officer, Paul Huxford and the Investment Strategy team bring you updates across three key areas:

Central bank hawkishness tests the AI-driven global growth trajectory

Central banks are showing less patience with persistent price pressures, signalling higher interest rates to dampen consumer demand and accommodate substantial AI-related capital expenditure. Policymakers face a delicate balancing act: reining in inflation without stifling the broader growth momentum driven by AI.

Australian equities face structural domestic headwinds

The domestic outlook is increasingly challenged by a slowing housing market and stubborn service-sector inflation, which continue to squeeze Australian consumer discretionary spending. Consequently, we anticipate local corporate earnings will face greater earnings pressure than global regions, where more resilient consumer demand and superior structural growth opportunities exist.

Selective positioning in risk assets is warranted

Our stance on risk assets remains positive but we adopt a selective approach in the current environment. We prefer infrastructure and its defensive characteristics over real estate, and utilise the barbell strategy in fixed income, balancing quality bonds against floating-rate global private credit to navigate ongoing interest rate volatility.

Warm regards,

Justin Crawford
Head of The Private Bank