ECONOMIC FORECAST
Yet Oxford Economics expects it to follow the same 
general pattern as the GDP. “We look for corporate 
profits to rise by 4.9% in 2026,” said Yaros. “That’s 
up substantially from the 0.5% expected when 2025 
numbers are finalized.” Even so, the 2026 pace 
remains slower than the 7.9% clocked in 2024.
The expected 2026 rebound in profitability stems 
from a belief that stimulus from Washington will lift 
all boats. “We believe the passage of the One Big 
Beautiful Bill, with its tax cuts for businesses and 
households, should help the economy regather 
some steam in early 2026,” said Anirban Basu, 
Chairman & CEO of Sage Policy Group (sagepolicy.
com). The legislation’s 100% bonus depreciation 
should help fuel business investment, while large 
tax refunds should invigorate consumer spending. 
Both activities are important drivers of the nation’s 
economy.
This stimulus from Washington is arriving at the 
same time companies are getting a more solid 
footing on the nation’s shifting trade policy. “There 
has been a bit of a shock to the system in and 
around tariffs over the past year, and it is taking 
some time for many operators to understand their 
impact,” noted Andrew Petryk, Head of Industrials 
at Brown, Gibbons Lang & Company, an investment 
banker (bglco.com). 
Specifically, companies have responded to China 
tariffs by sourcing imports from other countries—a 
move which has also lent succor to the nation’s 
recent supply chain ills. “Lead times have diminished 
as companies have found alternative or additional 
suppliers,” said Petryk. “Those that relied on one 
or two vendors now have three, four or five.”
Businesses should also benefit from a decline in 
the cost of money over the coming months, as the 
Federal Reserve shifts its focus from fighting inflation 
to bolstering employment. “We look for inflation to 
peak at just above 3% when 2025 numbers are 
finalized, and for the Fed to cut interest rates into 
2026 until the federal funds rate falls to about 3%,” 
said Yaros. That rate, while much higher than the 
rates of early 2022, is a considerable improvement 
over the 4.3% of mid-2025.
Declining interest rates, which encourage the 
launch of new projects, are also a reflection of 
looser pockets on the part of the nation’s lenders. 
“Credit conditions have improved significantly for 
businesses,” said Basu. “Companies with strong 
balance sheets will find bankers very willing to 
supply debt. We also know that equity investors, 
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