The latest U.S. data suggest that the economy will end the year on a high note. As has been the case for some time, the current strength reflects solid growth in consumer spending, due not only to the resilience of the labour market, but also to the steady increase in household net worth, NBC’s economist Jocelyn Paquet reports.
GDP set to grow by 1.7% in 2026
“As the drivers of recent performance are likely to remain the same in 2025, the U.S. economy should continue to outperform that of other rich countries, provided the new Trump administration sticks to the most pro-growth part of its agenda and keeps its protectionist instincts to a minimum.”
“While recognizing the high level of uncertainty surrounding these projections, our best guess at this stage is that the spending cuts announced by the Trump administration will be insufficient to prevent tax cuts from widening the deficit further. We therefore expect fiscal policy to have a positive impact on growth over the next two years. On the international trade front, we believe that Washington will refrain from imposing blanket tariffs, opting instead for a more targeted, less disruptive approach.”
“Against this backdrop, we have decided to significantly revise upwards our growth forecast for 2025, to 2.1%. GDP should then grow by 1.7% in 2026.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
Fed set to cut rates again, dot plot to drive USD action – LIVE
The Federal Reserve (Fed) is widely expected to cut the policy rate by 25 bps after the last meeting of 2024. Underlying details of the dot plot could provide important clues about the policy outlook and drive the US Dollar's valuation.
EUR/USD extends slide below 1.0500 ahead of Fed rate call
EUR/USD extends slide below 1.0500 amid a nervous wait-and-see stance. The pair's further upside remains capped as traders stay cautious and refrain from placing fresh bets ahead of the Federal Reserve's highly-anticipated policy announcements.
Gold near weekly lows ahead of Fed
Gold is practically flat near $2,650 on Wednesday after bouncing up from a one-week low it set on Tuesday. The precious metal remains on the defensive as the market braces for the outcome of the last Federal Reserve’s (Fed) meeting of the year.
GBP/USD holds above 1.2700 after UK inflation data
GBP/USD enters a consolidation phase above 1.2700 following the earlier decline. The data from the UK showed that the annual CPI inflation rose to 2.6% in November from 2.3%, as expected. Investors gear up for the Fed's monetary policy decisions.
Sticky UK services inflation to come lower in 2025
Services inflation is stuck at 5% and will stay around there for the next few months. But further progress, helped by more benign annual rises in index-linked prices in April, should see ‘core services’ inflation fall materially in the spring.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.