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Daily Risk Notes

Global Risk Watch, Standard Risk Global

Institutional risk intelligence, market context, and geopolitical notes for cross-border investors and global operators.

The week's highlights

Inflation's Second Act

The global inflation landscape in 2026 is defined not by a single narrative but by a profound divergence. The United States is navigating 'sticky' inflation at 2.4% — stubbornly above the Federal Reserve's 2% target — driven by tariff pass-through, services wage pressures, and shelter cost persistence. The Eurozone has returned to near-target at 1.9%. Japan, after decades of deflation, faces rising prices with CPI at 1.5% and the Bank of Japan hiking rates to 0.75%, their highest since 1995. And China confronts...

The Dollar's Dangerous Moment

The US dollar remains the world's dominant reserve, trade, and transaction currency — but the structural foundations that underpin that dominance are eroding along multiple simultaneous vectors. The dollar's share of global central bank reserves has declined from 71% in 2000 to approximately 57% by Q3 2025, a 14 percentage-point decline that accelerated after the 2022 freezing of Russia's dollar-denominated assets. Yet in absolute terms, dollar reserves have grown — the decline is relative, driven by...

The Due Diligence Revolution

Due diligence has undergone a fundamental transformation — from a post-signing compliance exercise to a pre-LOI strategic function that shapes deal economics, pricing, and go/no-go decisions. The global DD services market reached $7.6 billion in 2024 and is projected to grow at 7.7% CAGR to $11 billion by 2029, driven by regulatory convergence, ESG integration, and escalating cyber risk. Seventy-two percent of organisations now walk away from acquisitions due to ESG concerns, over 50% encounter ESG-related deal...

Where Risk Meets Return

The relationship between risk and return has been fundamentally altered. China's inbound FDI collapsed 75% from its 2021 peak to $86 billion in 2025, while outbound investment remained resilient at $144 billion — creating an unprecedented asymmetry in capital flows. Simultaneously, 24 of 27 EU member states now screen foreign investments (up from 11 in 2017), the United States introduced outbound investment screening for the first time targeting China's technology sectors, and emerging market cost of equity has...

The Compliance Avalanche: When Every Jurisdiction Regulates at Once

The EU has enacted ten major digital and sustainability regulations in 24 months. China has amended its Cybersecurity Law, expanded AI governance, and operationalised cross-border data certification. The US is simultaneously retreating on climate disclosure and accelerating on AI and privacy at the state level. Global AML compliance costs exceed $180 billion annually — yet detect less than 2% of illicit finance. For international businesses, the question is no longer whether to comply, but whether compliance at...

Disclaimer

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