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Bailey McCann, Opalesque New York: Private markets entered 2026 on firmer footing, as deal activity rebounds and supportive financial conditions help to extend the cycle, according to New York Life Investment Management's 2026 Private Markets Outlook.
Lower short-end rates and improving liquidity are
supporting confidence and deal flow. These trends are further supported by a change in regulatory priorities toward wealth creation. New York Life IM analysts suggest that overall the year will prove to broadly positive on the policy front, which could lead to improving conditions in the US, Europe, Japan and China.
Private markets are regaining momentum," said Sarah Hirsch, Global Market Strategist at New York Life Investment Management. "Easy financial conditions are reviving deal activity, even as elevated long-term rates enforce discipline. That gives the cycle room to run, but it also makes selectivity more important."
At the asset class level, private markets remain a core allocation although there is some evidence that investors are adjusting their mix of alternatives in response to market trends. Momentum in private equity deal activity built through 2025, for example, and is
setting the stage for a stronger recovery in 2026. However, investors are still working through persistent DPI issues in their portfolios. Analysts expect that activity will be focused on the lower middle market where there is less leverage and increased deal activity.
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