Navigating the 2026 economic outlook: inflation, market risks, and investment opportunities

The private markets sector is witnessing a transformative approach to investment strategy and risk management, with L&G Asset Management playing a leading role. At the Private Placements Industry Forum 2026, Andrew Tinari, Investment Manager in Private Markets at L&G Asset Management, shared his analysis of the economic outlook for 2026 and strategic approaches to private market investing.

Revolutionising private market investing
The private markets sector is undergoing significant transformation, and L&G Asset Management is at the forefront. At PPIF 2026, Andrew provided insights into the economic outlook for 2026 and the strategies reshaping private market investing.

Key risks and opportunities for 2026
Andrew identified three major risks shaping the private placements landscape:

1. Inflation and growth trends: A "higher for longer" interest rate environment is impacting discount rates, durations, and spread volatility.
2. Sectoral risks: Leveraged credit and cyclical sectors face challenges with refinancing maturities amid rising rates and widening spreads.
3. Liquidity risks: Geopolitical and policy influences could lead to abrupt market closures or constrained funding, emphasising the need for robust liquidity management.

Despite these risks, Andrew highlighted growth opportunities in alternative investments, infrastructure, and corporate markets.

Liquidity management strategies
Andrew addressed misconceptions about private placements being illiquid, emphasising the importance of portfolio construction and secondary trading markets. He outlined two key levers for managing liquidity:

• Portfolio construction: Incorporating liquidity sleeves, amortising structures, and diverse maturities to ensure consistent cash flow.
• Secondary trading: Leveraging a growing secondary market, which saw $6 billion in volume last year, to generate liquidity even in challenging conditions.

The illiquidity premium and spread buildup
Andrew explained that the illiquidity premium in private placements is driven by factors such as:

• Customisation of securities (e.g., amortising structures, off-the-run maturities).
• Confidentiality and reduced disclosure requirements.
• Complexity premiums for esoteric asset-backed securities and infrastructure projects.
• Cashflow variability, with issuers paying for embedded options like extendable maturities or anticipated repayment dates.

2026 originations and sector-specific opportunities
Andrew shared insights on the record-breaking growth expected in 2026, with private placement volumes projected to reach $200 billion—a 25% year-on-year increase. He highlighted opportunities across three key sectors:

1. Alternatives: The fastest-growing sector, with opportunities in asset-backed financings such as esoteric ABS, credit tenant leases, and aviation finance.
2. Infrastructure: Strong demand driven by data centres, grid modernisation, waste and water projects, and renewables, supported by secular tailwinds like Biden’s infrastructure bill.
3. Corporates: Steady issuance from repeat borrowers and new issuers, including rising stars transitioning from sub-investment-grade to investment-grade ratings. Defensive credits with strong free cash flow and pricing power also present attractive opportunities.

Andrew noted that while 2026 is expected to be a landmark year, the outlook beyond that will depend on market dynamics and issuer behaviour.

2026 Insights
Andrew’s insights reveal a private placements market that is both dynamic and resilient, with opportunities for investors who can navigate risks and leverage innovative strategies. With a focus on liquidity management, alternative investments, and tailored securities, private placements are attracting record numbers of new investors in 2026.

Discover more exclusive insights and join the community with industry leaders at Placements Industry Forum Europe 2026, Europe’s only dedicated private placements event. Join us 15–16 September 2026 in Amsterdam.