Augustine (Gus) Faucher es vicepresidente sénior y economista principal de The PNC Financial Services Group, desempeñándose como portavoz principal en todas las cuestiones económicas de PNC.

Antes de unirse a PNC en diciembre del 2011 como especialista sénior en macroeconomía, Faucher trabajó durante 10 años en Moody’s Analytics (anteriormente Economy.com), donde fue director y economista sénior. Fue responsable de dirigir el modelo informático de la economía estadounidense de la firma, editaba una publicación mensual sobre las perspectivas económicas de los EE. UU., cubría la política fiscal y monetaria, y analizaba varias economías regionales. Anteriormente, trabajó durante seis años en el Departamento del Tesoro de los EE. UU., y enseñó en la Universidad de Illinois en Urbana-Champaign. Fue nombrado vicepresidente sénior en marzo de 2015, economista principal adjunto en febrero de 2016, y a su función actual en abril de 2017.

Faucher es citado con frecuencia en los medios de comunicación internacionales, nacionales y regionales, The Wall Street Journal y The New York Times. Se ha presentado en ABC World News, CBS Evening News, NBC Nightly News y Nightly Business Report, y se presenta regularmente en CNBC, CNN y Fox Business. Además, se presenta regularmente en CBS Radio, NPR y Marketplace.

 

Transcripción:

Hi, I'm Gus Faucher, Chief Economist for the PNC Financial Services Group with an Economic Outlook for the third quarter of 2026. The U.S. economy appears to have shrugged off the conflict with Iran. Now that there's been a memorandum of understanding between the United States and Iran and energy prices have come down, the economy should continue to expand through the rest of this year and into 2027.

The labor market is holding up well this year and in fact has seen a slight acceleration in job growth from 2025. Last year, the economy only added about an average of 10,000 jobs per month, but this year the pace has been stronger, above 100,000 jobs per month on average through the first half of 2026. And in addition, the unemployment rate has fallen slightly down to 4.2% as of June.

This is right around where the Federal Reserve thinks the unemployment rate should be over the longer run, consistent with inflation, and the breadth of job growth is looking better this year than it did last year. In 2025, the U.S. economy would have lost jobs on net were it not for health care. That is, job growth outside of health care in 2025 was negative, in part due to the DOGE cuts from the federal government, but also in weak hiring in other industries outside of health care.

But in 2026, we are seeing a little bit broader job growth. We have more industries adding jobs. We've had small gains in manufacturing, that's looking better.

Industries like leisure hospitality services and professional and business services are doing a little bit better. So we are seeing a broader set of industries adding jobs in 2026, and that's good news for the sustainability of the labor market over the longer run. The labor market is also structurally tighter now than it has been for much of the past 25 or 50 years.

Some of this is due to the weak recovery from the pandemic, but also part of it is structural. That is, we are seeing the baby boomers continuing to retire. That's putting downward pressure on the labor force participation rate, the share of adults who are either working or looking for work.

And now over the past couple of years, it's coming from reduced levels of immigration and increased deportations. That means that businesses are having difficulties in finding workers, given the fact that the labor force is growing much more slowly. And that means that businesses are reluctant to lay workers off because they're concerned about finding workers in the future if they don't have enough.

And so this structurally tighter labor market that we are seeing is keeping hiring solid and is making sure that the economy is continuing to add jobs. We have seen the impact of higher inflation on consumer incomes. The blue line is after-tax personal incomes.

That's the income going to households from the labor market, from investment returns and from government transfer payments adjusted for inflation. That has been slowing over the last few years as the job market has softened and as wage growth has eased. And then you can see that big drop off in after-tax personal income due to higher energy prices in the aftermath of the U.S. conflict with Iran.

Now that that conflict with Iran has apparently ended, we are seeing after-tax personal income pick up somewhat. But the pace of growth is much weaker than what we've experienced over the past few years. But consumer spending growth, the orange line, again adjusted for inflation, is holding steady, growing at between 2 and 3 percent for most of the past few years.

We do expect that consumer spending growth is going to slow in the near term to a pace more consistent with income growth. But consumers are benefiting from rising home values, and high-income consumers are benefiting from the strong stock market increasing their wealth, which is also supporting their spending. We do expect that consumer spending, which makes up about two-thirds of the U.S. economy, will see slower growth this year and in 2027, but it should be solid enough to keep the economy moving forward.

The biggest concern for the Federal Reserve in mid-2026 is inflation. We have seen a pickup in inflation over the past year or so. Some of that is due to higher energy prices because of the conflict with Iran.

But the pickup started in 2025, before the conflict with Iran, and is due to factors like tariffs, supply chain difficulties, and so forth. We do expect that inflation will ease in the second half of 2026 as energy prices are coming down and we are seeing the impact of tariffs fade. But inflation is likely to remain above the Federal Reserve's 2 percent objective in the near term, even if we take out more volatile food and energy prices.

That being said, inflation should slow in the second half of this year, and that means that the Federal Reserve will keep interest rates where they are right now. We expect the Fed funds rate to remain in its current three-and-a-half to three-and-three-quarters percent range to the rest of 2026 and into 2027, as the Fed has the luxury of time and can afford to wait for inflation to slow. But outlook for the federal funds are weighted to the upside.

Overall, our forecast is for a bit slower economic growth through the rest of 2026 and into 2027, but continued expansion in the U.S. economy. That is, we are not expecting a recession anytime soon. Consumer spending growth will slow somewhat but remain solid.

We continue to see solid business investment, particularly related to A.I., and overall, the economy should continue to grow. With continued slow growth in the labor force, that's going to put downward pressure on the unemployment rate. Even with a bit slower job growth, we expect the unemployment rate to hold steady at its current rate of about 4.2 percent through the rest of 2026 and into 2027.

Dicho esto, los riesgos de la perspectiva se ponderan a la baja. It could be that high inflation leads the Fed to raise interest rates, which could be a drag on economic growth, and there's also the potential for a downturn in the stock market. If investors become less optimistic around A.I., they could pull back on investment there.

We could also see a lower stock market weighing on purchases by higher income households. But our forecast is for continued expansion and a continued low solid unemployment rate. Muchas gracias por su tiempo.

You can see all of our materials at pnc.com slash economic reports and you can follow me on X, formerly Twitter, @GusFaucherPNC.