U.S. Economic Growth: Converging Forces Depress Outlook Into 2026

Several factors, including tariffs, restrictive monetary policy, fiscal drag, high debt levels, and reduced immigration, are expected to suppress U.S. economic growth into 2026. Tariffs may reduce trade and capital flows, while the Fed's monetary policy could impede economic acceleration unless reversed.

High government debt continues to drain economic activity, and reduced immigration will also weigh on growth. This uncertain environment suggests a high risk of recession, making a downward trajectory of long-term Treasury rates likely.