Economic data continue to send mixed signals as inflation eases, growth expectations remain constructive, and Federal Reserve policy shifts influence market sensitivity. Together, these dynamics are shaping a more complex environment for stocks, valuations, and risk as 2026 begins.
US Economy
Here is how much each country’s economy expanded in the first three quarters of 2025, based on real GDP.
Global inflation continued to ease, although the pace of disinflation slowed.
The FHFA house price index rose in October to a record high, though the year-over-year gains continued to decelerate.
Mortgage rates ended 2025 at the lowest point for the year.
The moderating mortgage rates and slower price growth helped push pending home sales to their highest level since February 2023.
Initial jobless claims unexpectedly fell to 199k, well below the consensus. The surprise may be partially attributed to seasonal adjustment difficulties around the holidays. Continuing claims also declined, signaling limited layoffs despite sluggish hiring.
The weighted-average tariff rate ended 2025 at the highest level since the 1930s.
US Stock Market
Currencies:
Bond yields:
Sector performance data for 2025.
Crypto had a challenging year.
The Fed
Most central banks cut rates last year.
Great Quotes
“Give me six hours to chop down a tree and I will take the first four hours to sharpen the ax.” – Abraham Lincoln
Picture of the Week
Marble caves in Carrera Lake, Chile
All content is the opinion of Brian Decker
