Six Global Issues to Watch in June 2026
Is Putin Running Out of Time?
Russia’s war in Ukraine has turned into a quagmire from which it seems to be unable to escape. Not only has Russia lost territory to Ukrainian counterattacks in recent weeks, but it is suffering much high levels of manpower losses than in previous years as Ukrainian drones and other defenses make it nearly impossible for Russia to launch successful offensive military operations.
This has led to an intensification of Russia’s missile and drone attacks on Ukraine, but this has been countered by Ukraine’s increasing ability to strike targets deep inside Russia. Such attacks have led to fears of a much greater escalation in the drone and missile attacks from both sides in the months ahead.
All of this is bad news for Russian President Vladimir Putin, who expected a quick victory in Ukraine when he ordered the invasion of that country in 2022. Furthermore, Russia’s economy is struggling, despite the higher oil and gas prices that have been the result of the ill-planned war in Iran. As a result, opposition to the conflict in Ukraine, and to President Putin’s rule, is growing inside Russia, with the president losing significant support in recent months. If he cannot find a way out of this quagmire in Ukraine, his grip on power in Russia could begin to weaken substantially.
How High Will Inflation Go?
After peaking in 2022 due to disruptions linked to the Covid-19 pandemic and Russia’s invasion of Ukraine, inflation rates fell significantly in the following years. However, this decline in inflation rates came to an end in most major economies in 2025, with inflation proving surprisingly sticky.
Now in 2026, inflation rates have risen sharply again, due mostly to the war in Iran and the closure of the Strait of Hormuz. Some of the biggest increases in inflation have been found in Asia, with countries such as the Philippines, Vietnam and Bangladesh facing dramatic jumps in their inflation rates. Likewise, inflation rates in the Americas and Europe have also risen over the past three months.
Should the Strait of Hormuz remain closed for a prolonged period of time, inflation rates could rise much higher than they are at present. If this were to happen, consumer spending would likely fall and many central banks would be forced to raise interest rates again, something that could push the global economy into a much worse downturn than it is currently experiencing.
Will the Democrats Squander Their Golden Opportunity?
Amid a series of scandals, poor economic results and an unpopular war in Iran, United States President Donald Trump has seen his approval rating continue to trend downwards in recent months. To some, it now appears that President Trump no longer cares about his approval rating as it falls to new lows.
This is bad news for Republicans. Over the near-term, they are likely to suffer major losses in this year’s mid-term elections in the United States. Over the long-term, the damage caused by the mismanagement of the US by the Trump Administration could result in a long-term loss of support for the Republican Party that could keep it out of power for a prolonged period of time.
The big question now is, can the Democrats take advantage of the loss of support for the Republican Party. Deep ideological divisions within the Democratic Party have made it difficult for the party to present a united front against the struggling Republicans. For example, a large progressive wing of the Democratic Party wants to pull the party far to the left at a time when a move to the center could score the Democrats some major electoral gains. If the Democrats play their cards right, they could sweep back to power in the United States over the next few years, but this is not guaranteed.
What is Wrong with the European Economy?
Most European economies remain mired in a deep slump, leading to a sense of impending doom in much of that region. For the 2020s, the European economy has growth by around just 1% per year and the outlook for the region’s economy in the coming years calls for similarly low rates of growth.
Germany, the region’s largest economy, has recorded almost no growth in the 2020s, leading many economists to call Germany the new “Sick Man of Europe” as it struggles with over-regulation and strong foreign competition in many of its key industries. France also faces a very uncertain future as its economy struggles to grow and as its public financial situation deteriorates rapidly.
To overcome its current troubles, Europe will have to make some major changes. For example, it has fallen dangerously behind the United States and China in artificial intelligence and many other transformative technologies. At the same time, its energy policies and demographic decline have dramatically reduced Europe’s economic competitiveness. Finally, over-regulation has added to the obstacles to economic growth in Europe. If these challenges are not overcome quickly, Europe faces the prospects of long-term stagnation.
What Does Iran Want?
The war in Iran has been stuck in a sort of limbo for weeks, leading to lingering uncertainty for the global economy and for the geopolitical situation in the Middle East. Over the past month, there have been on-again, off-again talks between the United States and Iran, as well as occasional attacks from each side when these talks falter.
Iran clearly lacks the defense capabilities to win this conflict militarily. However, Iran, despite having an economy that is smaller than Portugal or Peru, has been winning this conflict from an economic standpoint. This is because Iran has shown that its strategic location enables it to cause massive disruptions to global trade and to the world’s energy supplies. At the same time, it has severely damaged the long-term positions of the much wealthier countries across the Persian (Arabian) Gulf.
It is unclear what Iran hopes to gain from this conflict. It can continue to hold energy supplies and the Gulf States hostage if it wants to inflict more economic pain on the world. It also would like to see the positions of the United States and Israel in the Middle East and Central Asia weakened to enable Iran to play a greater role in those regions. However, it remains to be seen how far Iran is willing to go to get a peace deal that meets many of these aspirations.
Are Birth Rates Doomed to Keep Falling?
Birth rates around the world have been in decline for decades. Most countries now have birth rates that are well below the replacement rate of 2.1, which is the birth rate that is needed to keep a country’s population stable if it has a zero net migration rate.
Asian countries such as South Korea, China and Japan now have some of the world’s lowest birth rates and this is leading to a dramatic decline in those countries’ populations. Europe too is home to some of the world’s lowest birth rates, although immigration has partially offset this in recent decades. Even New World countries such as the United States, Canada and Australia, which used to have much higher birth rates, have seen their birth rates trend downwards in the 21st century.
This trend looks unlikely to be reversed anytime soon. Some governments have enacted programs such as tax breaks and free child care to boost their countries’ birth rates, but this has had little impact. With more women in the workforce than ever before and with lifestyle changes working against higher birth rates, it appears that there will be no significant increase in birth rates for the foreseeable future. As a result, the world must begin preparing now for a world with little or no population growth, and a world with a much older population.