This is the daily update for today, January 1, 2026.
One word that discribes the US economy: Concerning
Based on the presented economic data, there are a few indicators that could suggest potential risks of a recession in the near future. The economic signals range from inflation to employment data and include several leading economic indicators. Let’s analyze the data in detail. First, the Consumer Price Index (CPI) for all urban consumers, which includes all items and excludes food and energy, has been hovering around the upper 2% mark year over year, which could signify a higher risk of recession. Additionally, the manufacturing sector appears to be showing signs of weakness. The Average Weekly Hours of Manufacturing Employees have seen a consistent decrease over the past few months. Meanwhile, the New Private Housing Unit Authorized by Building Permits has consistently reported negative change on a year-on-year basis, indicating potential stress in the housing market. Finally, it’s concerning that various financial stress indices, such as the Kansas City Financial Stress Index and the St. Louis Financial Stress Index, are showing mild upward trends, suggesting an increase in financial anxiety.
Despite these factors, it's important to note that the situation is dynamic and these data points need to be considered in conjunction with other economic trends and external factors. The yield curve, which is one of the most closely-watched indicators for predicting economic downturns, has remained within the neutral zone recently, providing mixed signals. Furthermore, the M2 Money Stock, which reflects the amount of liquid money in the economy, has maintained a steady growth rate. It is essential to take a holistic approach and monitor a variety of economic indicators as they continue to evolve.
Text written with ChatGPT from OpenAI.