Apollo: The American economy enters 2026 with strong momentum, and the AI dynamic will help to resist the risk of stagnation.

Tosten Slok, Chief Economist of Apollo Global Management, stated that after a year full of unexpected surprises, the American economy is entering the 2026 trading year with a strong stance. Slok pointed out that the economic growth in 2025 exceeded expectations multiple times, highlighting the resilience that the economy possesses despite facing significant headwinds. While trade tensions and tariff uncertainties, stricter immigration rules, and the restart of federal student loan repayments have put pressure on economic activity, they have not been able to halt its growth momentum. At the same time, several positive factors are also gaining momentum. Investments related to artificial intelligence (AI) and data center expansion remain strong, the US dollar has weakened, and fiscal policy may provide additional support. The Congressional Budget Office (CBO) estimates that the "big beautiful" bill could boost the Gross Domestic Product (GDP) by nearly one percentage point in 2026. Looking ahead, Slok warned of a possible brief period of stagflation. He added that with additional tariffs coming into effect, growth is expected to slow down, and the inflation rate is still above the Federal Reserve's target (around 3%), which will keep interest rates at higher levels for a longer period. However, Slok expects this slowdown in growth to be temporary, followed by a renewed acceleration driven by AI. While the consensus expectation is that the possibility of a US economic recession in 2026 is close to 30%, he stated that the current overall outlook remains constructive. Slok said, "The bottom line is, despite experiencing severe turbulence, the US economy remained resilient in 2025. With more signs of improvement emerging, we have every reason to be optimistic about the growth momentum entering 2026."