Top economic factors to watch in 2026

Economic Outlook - The economic outlook for 2026 presents mixed signals, with potential for a stronger economy than anticipated, particularly in the first half of the year [2] - The Federal Reserve is expected to maintain a pause on interest rates through most of the first half of next year, with a gradual increase in the probability of rate cuts by April or June [3][4] Consumer Behavior - Despite low consumer confidence and sentiment, there is a notable willingness to spend, supported by healthy balance sheets and low unemployment rates [6][8] - Tax refunds are expected to be larger in 2026, which may further encourage consumer spending [8] Corporate Investment - The introduction of accelerated depreciation at the corporate level is a significant tax change that could impact investment, although the extent of its awareness and utilization remains uncertain [10][11] - There is potential for this depreciation to stimulate investment beyond just AI, which has been a primary focus, indicating a broader opportunity for growth in various sectors [13]