Deutsche Bank forecasts a positive 2026 outlook as it says the U.S. economy shows resilience

[Year 2026 with a Bulls eye and 3 arrows on light green background]
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Deutsche Bank’s research team sees U.S. markets remaining on solid footing despite lingering fiscal uncertainties.

In a note to its clients, the bank highlighted that strong economic growth, coupled with a supportive Federal Reserve policy, should continue to provide a favorable environment for equities through 2026.

Deutsche Bank spotlighted that recent data indicate that the U.S. economy has proven more resilient to trade tensions than initially anticipated. Q2 GDP grew 3.8% sequentially, driven in large part by robust consumer spending. While the labor market showed signs of softening over the summer, it remains comfortably tight, providing continued support to domestic demand, the investment institution said.

Deutsche Bank anticipates a moderation in growth during the second half of 2025, as the effects of tariffs gradually weigh on the economy. However, the bank projects a rebound in 2026 and 2027, suggesting that the slowdown will be temporary.

“Overall, the US might be at the sweet spot of slightly slowing growth combined with a more accommodative central bank, which should support equities into Q4 and 2026,” the research team noted. Some investors may view this combination as a constructive backdrop for portfolio positioning in the year ahead.

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