The U.S. Economy Enters 2026 on Solid Ground

As 2025 drew to a close, the U.S. economy demonstrated resilience and stability across key indicators, setting the stage for cautious optimism in the new year. From employment and inflation to housing and consumer goods, the data paints a picture of steady progress amid lingering challenges.

Labor Market: Jobs Hold Strong

The labor market continues to be a pillar of strength. In December 2025, the unemployment rate edged down to 4.4%, improving slightly from November’s 4.5%. This decline signals sustained demand for workers and a healthy job environment, even as businesses navigate evolving economic conditions.

Inflation: Price Pressures Under Control

Inflation remained tame, with the **Consumer Price Index (CPI) holding steady at 2.7% year-over-year** for the 12 months ending in December. This stability suggests that earlier efforts to curb inflation have taken hold, providing relief to households and businesses alike.

Economic Growth: Momentum Continues

The economy showed robust growth in the third quarter of 2025, with real GDP expanding at an annualized rate of 4.3%. This surge reflects strong consumer spending and investment activity, reinforcing confidence in the nation’s economic trajectory.

Stock Market: Near Record Highs

Wall Street maintained its upward momentum into early January 2026. The Dow Jones Industrial Average hovered near 49,500, while the S\&P 500 reached approximately 6,966, and the NASDAQ settled around 23,710. These figures underscore investor confidence, even amid global uncertainties.

Housing Market: Elevated Prices Persist

Housing affordability remains a challenge. The **median home price in October 2025 ranged between $415,000 and 424,000, higher than many anticipated. While growth has moderated compared to previous years, elevated prices continue to strain buyers in key markets.

Consumer Goods: Signs of Relief

For everyday consumers, some relief is emerging. **Egg prices averaged about $2.70 per dozen in December**, marking a decline from prior spikes. However, prices remain above pre-2022 norms, reminding shoppers that full normalization may take time.

Key Takeaways

Jobs: Strong labor market with unemployment at 4.4%.

Inflation: Stable at 2.7%, signaling controlled price growth.

Growth: GDP surged 4.3% in Q3 2025.

Markets: Stock indices near record highs.

Housing:cPrices remain elevated.

Consumer Goods: Egg prices easing but still above historical averages.

Bottom Line: The U.S. economy enters 2026 on solid footing. While challenges persist—particularly in housing affordability—steady employment, controlled inflation, and robust growth provide a foundation for continued progress. Businesses and consumers alike can look forward to a year of cautious optimism.