The World Economic Forum's latest Chief Economists' Outlook reveals growing concerns about artificial intelligence-driven asset valuations, with a majority of economists warning of potential market corrections ahead. The quarterly report, based on 36 survey responses collected between November 19 and December 3, 2025, draws insights from leading chief economists across public and private sectors.

AI Stock Valuations Under Intense Scrutiny

The report highlights significant concentration risks in US technology markets, where the "Magnificent Seven" tech firms now represent approximately 35% of total index market capitalisation, a substantial increase from 20% in November 2022. These valuations have climbed into the top 10% of their historical distributions, raising red flags among economists.

The survey reveals a stark divide in expectations for AI-related equities, particularly in the United States. While 52% of respondents anticipate declines in US AI-linked stocks over the next year, 40% foresee continued gains, highlighting significant uncertainty around pricing and long-term returns.

Cryptocurrency and Dollar Face Bearish Outlook

Cryptocurrencies emerge as the most pessimistic asset class in the survey, with nearly two-thirds (62%) of chief economists expecting further price declines following recent market turbulence. The digital asset sector faces mounting skepticism amid regulatory uncertainties and market volatility.

The US dollar also faces headwinds, with 54% of economists expecting weakness, reflecting concerns around fiscal pressures and shifting global capital flows. In contrast, gold sentiment remains mixed, with 46% expecting price increases while 31% believe the precious metal has peaked after recent rallies.

AI Productivity Gains Remain Promising

Despite valuation concerns, economists maintain optimism about artificial intelligence's productivity potential. Approximately four in five respondents expect meaningful productivity improvements within two years in both the US and China, suggesting the technology's fundamental value proposition remains intact.

The information technology sector leads adoption expectations, with nearly three-quarters of economists anticipating near-term productivity gains. Financial services, supply chains, healthcare, engineering, and retail sectors are also viewed as fast movers with one-to-two-year adoption timelines.

Large firms with over 1,000 employees are positioned to benefit sooner, with 77% of chief economists expecting meaningful gains within two years. This disparity underscores concerns that AI-driven growth may initially create uneven benefits across company sizes.

Davos Meeting to Address Economic Challenges

The findings will frame discussions at the World Economic Forum's 56th Annual Meeting, scheduled for January 19-23, 2026, in Davos-Klosters, Switzerland. Global leaders will examine these economic challenges and explore potential collaborative solutions to address market concentration risks and technological disruption.

US President Donald Trump will attend the World Economic Forum Annual Meeting in the Swiss ski resort town of Davos, accompanied by five cabinet members, while the summit will feature a strong delegation from India, organisers announced on Tuesday.

Historic Participation Expected

The five-day annual meeting beginning January 18 will witness historic participation of more than 3,000 world leaders, according to WEF President and CEO Borge Brende. The event, held under the theme "a spirit of dialogue," will bring together global leaders amid what Brende described as "the most complex geopolitical situation since 1945."

Global Leadership Representation

At least 64 heads of government or state will be present at the summit, with six out of seven G-7 countries represented by top leadership. China and Pakistan will also have significant delegations attending the event, while Ukraine President Volodymyr Zelenskyy will participate in the discussions.

The meeting will feature unprecedented technology leadership presence, with heads of major companies including Nvidia and Microsoft among the attendees. "We also never had more technology leaders at Davos," Brende noted during an online press conference.

Key Focus Areas

The WEF Annual Meeting will address several critical global issues:

• Ukraine conflict and regional stability
• Gaza situation and Middle East developments
• Latin America, including Venezuela
• Complex geopolitical challenges facing the world

Brende emphasized that dialogue has become "not a luxury but a necessity" in the current global context. A significant bipartisan delegation from the US Congress and state governors will also attend the meeting, reinforcing the emphasis on international cooperation and dialogue.

Strong International Presence

The summit will bring together diverse global representation, with India expected to send a strong delegation alongside other major economies. The participation of multiple finance ministers and central bank governors indicates the meeting's focus on addressing economic challenges and fostering international collaboration during uncertain times.