Lazard's macro master on Iran, finding better returns and the new safe haven assets

Please note this interview was filmed on 4 August 2026. 

When I last spoke to Lazard Asset Management's chief market strategist Ron Temple in February, he quite presciently predicted that the US could attack Iran at a time when the possibility was barely on the radars of many others.

As he told me at the time, "the biggest near-term risk I'm worried about is the risk of US attack on Iran. We think there's a high probability the US will attack."

10 days later, the countries were at war. 

6 months later, and the Iran War remains one of the headline macro events shaping the story of markets in 2026. But it's arguably distracting away from more significant structural changes under the surface. 

In this interview, Temple explores the key underlying trends shaping the investing landscape, where the Iran War goes next, and where investors need to look next for the great returns they've been enjoying in recent years.

The core convictions shaping markets

Temple's outlook remains defined by what he calls his three core convictions - a continued weakening of the US dollar, steepening yield curves in the developed world and the beginning of the end of US exceptionalism.

All have come to fruition in 2026, but Temple believes each thesis still has further to run. 

The US dollar declined 12% in 2025 as measured by the DXY, an index that tracks the dollar's strength against other major currencies. Temple now expects the dollar to depreciate 3-5% over the next three to five years. 

That's significant to investors because of how it impacts your relative returns on US assets, which global investors are increasingly exposed to. 

"One of the most pressing concerns over the last two years has been a discomfort from a risk management perspective about just the sheer magnitude of assets that non-US investors have in the US," says Temple.

"The US has reached 63% of the MSCI All Country World Index and 41% of the Bloomberg Global Aggregate Bond Index. It's a lot of capital to have in one country when your liabilities are in Australia or in Singapore or Japan."

"What I think you're going to see is more people still hanging onto their assets in the US, but raising the amount of the foreign exchange risk that they hedge."

That is coinciding with a steepening of yield curves across major developed economies as government debts continue to grow, says Temple.

Where the opportunities are

While the US has been the undeniable driver of the majority of global equities growth since the GFC, that may no longer be the case. 

In the US, returns remains heavily reliant on AI capex spending, and growing skepticism around the ability of hyperscalers to get a return on that spend. Where once increased capex was seen as bullish by the market, investors are now selling off stocks that announce big capex increases.

"The modal expectation is five to 10 trillion dollars of capex from 2023 to 2030 in the United States on AI," says Temple. "Getting to a 10% ROIC on those kind of numbers is very difficult. I worry that it seems the market is starting to recalibrate and appreciate that it's going to be hard to get a good return on this capital."

In China, a decades-long economic boom driven by labour has given way to one of automation at the same time that the housing market is in crisis. 

"China has installed more robots in the last year than the rest of the world combined," says Temple. "You're not getting the same job growth and wage growth, which means you don't have as strong of an underpinning for consumption."

But he's not sounding the alarm on the US and China, but believes investors looking for better returns could do well to look elsewhere right now. 

The argument in favour of emerging markets is twofold: attractive earnings growth and better diversification.

"The reason for my optimism on emerging markets is when I look at the earnings growth on a prospective basis, it looks as good as the United States," says Temple. 

"Earnings growth expectations at EM are strong. But what I like about the emerging market earnings growth, it's more diversified across sectors and countries."

"You've got materials earnings growth that lifts South Africa, you've got energy earnings growth that's positive for Brazil and Columbia. You've got consumer earnings growth in other countries. You've got technology - I don't have to lose my AI exposure."

Emerging markets also trade at a big earnings discount to the US, the potential tailwind of US dollar depreciation and even institutional flows.

In Japan, the story is that deflation is dead. 

"Since 2021, consumer prices are up 13.8% in Japan. In the prior 24 years in total, prices were up 1%. So deflation's over," says Temple.

Corporate governance reform is also a positive catalyst for shareholders, as is an ongoing, inflation-driven structural trend that is seeing Japanese investors move from cash to equities. 

One other upshot of Temple's predictions around steeper yield curves, high debt-to-GDP ratios and inflation is how it shapes investors' perceptions of safe haven assets.

"It's going to be hard for markets to basically deliver the supply of credit to those governments without demanding a higher price. And in particular, I think at the long end of the curve, the premium goes up."

Investors may start to look to emerging market debt, where economies are much less levered, as an alternative to developed market government debt. 

Another trend may be a renewed preference for certain income-producing assets. Real estate may remain a challenging sector, given the rates backdrop, but infrastructure could emerge as a winner, according to Temple. 

Where the Iran War goes next 

Temple's says his prescience on the conflict in the Middle East should be attributed to Lazard's geopolitical advisory business, which includes former CIA deputy directors and the former head on central command on Operation Midnight Hammer, the 2025 US military airstrikes on Iranian nuclear facilities.

He says its team of analysts see three possible scenarios playing out in Iran. 

The best case scenario is, Temple says, "a comprehensive agreement that covers a nuclear deal in terms of eliminating the Iranian nuclear programme, eliminating or significantly curtailing their ballistic missile programme, opening the Strait of Hormuz with no tolls."

"In exchange for those things, you would have an unfreezing of Iranian assets, a reduction of US sanctions on Iran, the end of the naval blockade. And basically you would end up with a very positive scenario potentially where Iran could start redeveloping its economy and you could be back to a stable equilibrium in the Persian Gulf." 

"Unfortunately, the probability of that all happening in the next six to 12 months is very low in our view."

At the other end of the spectrum is a return to March and full scale hostilities and kinetic warfare. That is also unlikely, given certain pressures. Those include the fact the US has depleted its supply of defensive interceptor stockpiles and the vulnerability of energy markets given the huge supply shock to both crude oil and refined oil, due to the Russia-Ukraine War.