Infundly Weekly Briefing - 6 November 2026
This week’s research brings a useful combination of monetary policy, financial-system change and portfolio construction. The Bank of England’s latest forecasts highlight the difficulty of distinguishing temporary inflation shocks from more persistent pressures, while new BIS research examines how digitalisation could fundamentally change banking profitability, liquidity and risk.
The broader theme is whether established investment assumptions remain reliable as market structures change. For fund selectors, that means looking beyond headline exposures and forecasts to understand how managers assess economic drivers, adapt portfolios and test their investment cases.
This week's shortlist
Bank of England — Monetary Policy Report: November 2026
5 November 2026 · Monetary policy and fixed income
What changed: The MPC voted 8–1 to increase Bank Rate by 25 basis points to 4%. September CPI inflation reached 3.5%, with the Bank now projecting inflation of approximately 5% by mid-2027. The Bank is particularly concerned about the possibility of higher energy costs feeding into broader prices and wages, although evidence of those secondary effects remains limited.
Worth reading because: This provides a useful framework for challenging UK fixed-income and multi-asset managers. How do they distinguish between a temporary inflation impulse and a sustained regime change? What would cause them to adjust duration, inflation-linked exposure or credit risk?
NBER — Unraveling the Cobweb of Global Imbalances: Drivers, Vulnerabilities and Adjustment Scenarios
November 2026 · Working Paper 35962
What changed: The paper examines the sharp increase in global external imbalances, including deterioration in the US net international investment position and corresponding changes elsewhere. It considers the vulnerabilities created by these imbalances and possible adjustment paths.
Worth reading because: This is useful for global equity, sovereign bond and currency allocation. Persistent external imbalances can influence capital flows, funding conditions and valuations, but the implications depend on how adjustment occurs. Selectors should examine whether managers' currency and geographic positioning reflects explicit assumptions about these mechanisms.
BlackRock Investment Institute — Weekly Market Commentary: Intersecting Mega Forces
2 November 2026 · Market strategy and portfolio construction
What changed: BlackRock is placing greater emphasis on the interaction between structural investment themes rather than treating them as separate exposures. Its November framework considers how those themes influence asset-class returns, tactical positioning and potential opportunities for active management. It also highlights uncertainty around the returns on AI-related capital investment.
Worth reading because: This is particularly relevant to multi-asset manager research. A portfolio can contain several apparently distinct investments while depending on similar economic drivers. The useful question is whether managers identify those overlaps and distinguish strategic exposures from shorter-term positioning.
NBER — Demand-Driven Inflation
November 2026 · Working Paper 35980
What changed: Domenico Giannone and Giorgio Primiceri revisit the causes of post-pandemic inflation. Using several structural models, they find that unexpectedly strong demand played the predominant role in the US and euro area. This challenges explanations that attribute the inflation episode principally to supply disruption.
Worth reading because: Inflation attribution matters for assessing macroeconomic forecasts and fixed-income positioning. If managers misidentify the forces driving inflation, their expectations for central-bank responses, bond yields and asset-class correlations may also be unreliable. This paper provides a useful challenge to established narratives.
J.P. Morgan Asset Management — Weekly Market Recap: Equity Market Concentration
Week ending 30 October 2026 · Equity allocation and market context
What changed: J.P. Morgan examines the unusual resilience of US equities during a midterm-election year. Despite geopolitical disruption and inflation concerns, the S&P 500 had gained nearly 13% year-to-date by late October, with performance supported by earnings and AI-related investment. Leadership, however, remained concentrated in technology and energy.
Worth reading because: This provides a useful starting point for reviewing active equity managers' sources of return. Selectors should distinguish between genuine stock-selection skill, structural sector exposure and participation in a narrow group of market leaders. The same applies when assessing whether active funds provide meaningful diversification alongside passive holdings.
Infundly takeaway
A common theme running through this week’s research is that investment outcomes increasingly depend on understanding the economic forces beneath familiar asset-class exposures. The Bank of England’s latest forecasts and the NBER inflation research illustrate why identifying the causes of inflation matters as much as forecasting its direction. The work on global imbalances adds another dimension, highlighting how capital flows and external vulnerabilities can influence currencies, funding conditions and asset valuations. For selectors, this reinforces the importance of examining how managers develop their investment assumptions, what evidence supports them and how those assumptions translate into actual portfolio decisions.
The second theme concerns the difference between apparent and effective diversification. Global capital imbalances, concentrated equity-market leadership and overlapping structural investment themes can create common exposures across investments that appear distinct. BlackRock and J.P. Morgan provide useful perspectives on how these relationships are influencing portfolio construction. The implication for fund research is not simply to identify concentration, but to establish whether it is deliberate, adequately compensated and understood within the wider portfolio. That requires looking beyond fund labels and historical correlations to assess the underlying drivers of returns and the conditions that could challenge them.
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