Temasek Sees Private Credit and Core-Plus Infrastructure as Key 2026 Allocation Bets

Private credit and core-plus infrastructure are expected to offer attractive risk-reward profiles for investors seeking diversification away from equities in 2026, Temasek chief executive Dilhan Pillay said at Abu Dhabi Finance Week.

He said private credit provides senior-position exposure within the capital structure, while core-plus infrastructure can deliver stable, long-term cash yields from assets such as data centres and energy-transition projects.

The comments build on Temasek’s plans to lift allocations to private credit and core-plus infrastructure, following the recent spin-off of its private credit platform, Aranda.

Fellow panellists from UBS, Morgan Stanley and Allianz pointed to heightened geopolitical risks in Europe, warning that further escalation in the Russia–Ukraine war could unsettle markets.

Some also said Europe’s re-armament drive may create selective investment opportunities in defence-related industries.