In the Knick of Time

Despite concerns over a strong labor market and overheating, US economic growth is expected to moderate in the second half of 2026. This outlook, supported by a potential stabilization in oil prices due to a US-Iran deal, suggests that current market anxiety may be overblown.

Key Takeaways

• 1.US economic growth is likely to moderate as policy tailwinds fade, mitigating concerns of overheating.
• 2.The US-Iran agreement to reopen the Strait of Hormuz reduces risks of sustainably higher oil prices and associated inflation.
• 3.Federal Reserve policy expectations are shifting, with current market pricing being more hawkish than the UBS forecast of two rate cuts in 2027.

Table of Contents

• In the Knick of time
• Blog
• Global asset class preferences definitions
• Appendix

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