Make-Up Work

Taking time away due to illness is never ideal. Upon return to school or work, we are greeted with all the tasks we did not complete while incapacitated. The recovery may feel worse than the disease.

We are still recovering from the affliction of a record-setting federal government shutdown, which halted the publication of key economic statistics. We still haven't fully recovered our sense of conditions, but nothing we have seen has altered our sense that the U.S. economy remains resilient.

A new year offers an opportunity to chart a new course. 2026 could bring some relief to U.S. households and businesses. Income tax refunds are poised to increase, trade deals may take shape, and housing affordability proposals are coming into focus. Policy uncertainty will feel less shocking, while the short-term interest rate outlook stabilizes. The low-turnover job market seems bound to break one way or the other: some sectors may see hiring, though layoffs could take hold in others.

Following are our thoughts on the U.S. economy.

KEY ECONOMIC INDICATORS