July 2026 Monthly Economic Update

Bolton’s July 2026 Monthly Economic Update provides a clear, data‑driven snapshot of the U.S. economy amid ongoing market uncertainty.

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Perspectives from our CIO:

• Economic growth is slowing, but the consumer remains supportive. Second-quarter GDP grew at a 1.5% annualized rate, down from 2.1% in the first quarter. The slowdown reflected weaker government spending and slower growth in investment and exports, while consumer spending continued to provide support to the economy.
• Inflation has improved modestly but remains elevated. PCE inflation declined to 3.7% and moved just below the wage growth measure in our report. While this represents some improvement, inflation remains elevated relative to the Federal Reserve’s 2% longer-term objective and continues to be an important consideration for consumers and markets.
• Consumer behavior and confidence continue to tell somewhat different stories. Retail sales remain healthy, growing 5.0% from a year ago, while unemployment remains relatively low. Despite that underlying resilience, consumer sentiment remains historically subdued. Households continue to spend even as persistent inflation and geopolitical uncertainty weigh on how they feel about the economic outlook.
• Higher interest rates present both challenges and opportunities. Rates have moved higher across much of the Treasury yield curve since the end of 2025. While rising rates can create near-term price pressure on existing bonds, they also improve the income available from newly purchased fixed income securities, creating more attractive income opportunities for long-term investors.
• Equity markets remain supported by strong fundamentals, although valuations remain elevated. U.S. equities were relatively flat during July as investors questioned the level of spending associated with artificial intelligence, but the S&P 500 has since recovered to new highs. Corporate earnings and profit margins remain strong, while valuations remain above longer-term averages. This means investors are still paying relatively high prices for those earnings.

Download the full July 2026 Monthly Economic Update to the right to explore the data and insights in more detail.