EMs to see lower inflation in 2026

In China, the BMI Global Macro Key Themes For 2026 report expects inflation to remain subdued, ending 2026 at 0.5% y-o-y; while in Turkiye, we forecast inflation to remain elevated at 26.8% y-o-y, albeit down from 33.0% at end-2025. As for DMs, inflation risks remain skewed to the upside.

By Steve UMIDHA Last updated Jan 20, 2026

Inflation across Emerging Markets (EMs) is expected to ease from 4.5% y-o-y at end-2025 to 4.2% at end-2026, but when excluding China, the numbers are higher at 8.0% and 7.0%, respectively.

According to the latest prediction by BMI, a Fitch Solutions firm, EM Europe and Latin America will lead disinflation from 12.7% y-o-y and 6.8% at end-2025, respectively, to 9.9% and 5.7% at end-2026, respectively. “In contrast, over the same time period, we expect inflation to accelerate in SSA (from 14.45% y-o-y to 15.5%) and EM Asia (0.6% to 1.1%),” notes the report.

Further projecting, that MENA inflation to be broadly unchanged at 3.2% y-o-y at end-2026. In several large EMs, it expects inflation to remain above target.

“For example, we forecast Russia’s inflation at 5.7% y-o-y at end-2026 and Colombia’s at 4.9% at end-2026, above their central banks’ targets of 4.0% and 3.0% respectively.

Elsewhere, inflation is expected to remain within target ranges but near the upper bounds; in Brazil and Mexico, we anticipate end-2026 inflation rates of 4.0% and 3.8%, respectively, close to the upper limits of the 1.5%-4.5% range in Brazil and the 2.0%-4.0% range in Mexico,” it said.