The “Big Money Show” panel discussed the recent declines in gas prices, record stock market performance, and positive economic indicators, generating chatter among critics.
According to Goldman Sachs, the resilience of the U.S. economy is anticipated to extend into 2026, with growth likely to pick up due to tax cuts and improved financial conditions, as inflation and tariff pressures lessen.
In their 2026 forecast, Goldman economists led by Jan Hadzius pointed out that economic growth this year faced obstacles from unexpectedly high tariffs, which were several percentage points above predictions for U.S. imports.
“While we had anticipated that the positive factors in the U.S. economy would overcome the tariffs, this wasn’t always the case, and the projected 2.1% growth rate actually fell short by 0.4 percentage points,” they explained. “The discrepancy can be attributed to the average effective tariff rate rising by 11 percentage points, which is notably higher than the 4 percentage points we had estimated as a baseline. However, it’s slightly lower than the 14 percentage points accounted for in our more pessimistic scenario.”
Goldman Sachs remains optimistic. They project a real GDP growth of 2.6% for 2026, surpassing the consensus estimate of 2% from Bloomberg. This continued positive outlook reflects ongoing confidence in the U.S. economy post-pandemic.
Three key factors are expected to drive this economic growth acceleration in 2026. First, a decrease in tariff resistance has been noted, with the average effective tariff rate showing a slight decrease of 0.6 percentage points.
Second, the reforms included in the One Big Beautiful Bill Act (OBBBA) are predicted to catalyze growth. Economists at Goldman project that consumers will see an additional $100 billion in tax refunds in the first half of next year, translating to roughly 0.4% of annual disposable income. Moreover, the provisions allowing businesses to fully deduct capital investments are already showing positive impacts on future investment metrics.
The third factor is the favorable financial conditions stemming from anticipated interest rate cuts by the Federal Reserve, along with deregulation and increased economic growth driven by advancements in artificial intelligence (AI).
Despite the optimistic projections for economic growth, Goldman Sachs does not foresee a substantial improvement in the labor market. The market seems to be cooling as economic uncertainties linger, influenced by tariffs, shifts in immigration policies, and reductions in federal government size.
The unemployment rate rose to 4.6% in November from 4.1% in June. While some fluctuations can be attributed to the recent government shutdown, analysts noted that the labor market began to show signs of cooling earlier in the year, indicating a possible ongoing trend.
Goldman predicts that the most significant productivity benefits from AI are still a few years away, projecting stability for the U.S. unemployment rate at around 4.5% in 2026. However, they cautioned against expecting a significant drop in the short term.
“It’s quite plausible that unemployment could rise further in the near future if productivity-enhancing AI tools become available sooner than anticipated, or if companies decide to focus on cutting labor costs more aggressively in 2026,” Goldman economists wrote.
As for inflation expectations, Goldman observes that high core PCE inflation at 2.8% in 2025 is largely due to tariff impacts. They noted that without these tariffs, inflation would likely have decreased to about 2.3%.
These economists predict that as tariff effects diminish, core PCE inflation should gradually decline to just above 2% by the close of 2026.
