Goldman Sachs expects GDP to grow by 2.5% in 2026, driven by tax incentives and real wage growth. Inflation should stabilize with core PCE inflation at 2.1% by December.
The Federal Reserve may cut interest rates by 25 basis points twice this year due to concerns over the labor market, maintaining the unemployment rate at around 4.5%. Nevertheless, there is a warning of potential ‘jobless growth’ from AI advancements.
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