Cathie Wood predicts US inflation will bottom out in 2026, with multiple factors potentially helping prices to decline

ARK Invest founder Cathie Wood recently issued a thought-provoking economic forecast. She pointed out that 2026 could become the so-called “Goldilocks” year — a year when US inflation may drop to zero or even turn negative.

According to Cathie Wood’s analysis, the prerequisite is that energy and housing rent costs continue to decline. She believes that after recent disruptions such as trade policy adjustments, government fiscal risks, and the Federal Reserve’s relatively hawkish stance, if these two key cost components indeed fall as expected, then the overall price level will face significant downward pressure.

The term “Goldilocks” originates from a fairy tale and in economic context refers to an optimal state that is neither too hot nor too cold. Cathie Wood’s statement implies that 2026 could usher in an ideal economic environment with supply and demand in balance and stable prices — avoiding the troubles of high inflation while not falling into a deflationary spiral.

This forecast reflects a new round of market expectations for future price trends and sketches a relatively optimistic macroeconomic outlook for investors. However, the realization of such predictions still depends on multiple variables aligning simultaneously, including energy supply patterns, real estate market dynamics, and policy implementation effects.