Richmond Fed's Tom Barkin Highlights Resilient US Economy and Dual Mandate Challenges in 2026 Outlook

Richmond Fed President Tom Barkin Delivers 2026 Economic Speech

Richmond Federal Reserve President **Tom Barkin** spoke on January 6, 2026, outlining the US economy's resilience amid mixed signals. He noted third-quarter GDP growth at a strong **4.3 percent** and core PCE inflation at **2.8 percent**, down from peaks but still above target.[1]

Unemployment stands at a historically low **4.6 percent**, despite recent upticks, seen only three times in recent decades. Barkin emphasized balancing both sides of the Fed's mandate: low unemployment and controlled inflation.[1]

Key Drivers of Economic Strength

Barkin attributed resilience to surging **AI investment**, productivity gains, and reduced labor supply growth from lower immigration and retirements. Federal spending cuts have been milder than expected, supporting stability.[1]

Upcoming stimuli include tax refunds from recent legislation, lower gasoline prices, deregulation, and effects from **175 basis points** of rate cuts over 16 months. High asset values continue easing financial conditions.[1]

JPMorgan's Latest US Economy Prediction

On January 4, 2026, Fox Business discussed **JPMorgan's new 2026 prediction**, focusing on pro-business policies like tariffs on imports such as cabinets and furniture. Panelists analyzed impacts on jobs post-Biden inflation era.[2]

Tariffs set to double to **50%** on certain goods starting soon, alongside **30%** on poster furniture, spark debate on job market effects and AI training for **$10 trillion** in needed investments.[2]

Business Leaders' Optimism Survey

JPMorganChase's survey shows US business leaders entering 2026 with recovering optimism, especially middle-market firms rebounding to last year's levels post-election.[3]

Top concerns: **economic uncertainty (49%)**, revenue growth (**33%**), tariffs and labor (**31%** each). While **51%** see no recession, only **39%** are optimistic about the national economy; small businesses build cash reserves (**47%**) against inflation.[3]

• Middle-market optimism surges after 2025 dips from tariffs and regulations.
• **59%** view AI as essential for competitiveness in three years.
• **61%** plan AI for operations streamlining; over half expect economic stabilization.

Broader Context and Policy Implications

Barkin stressed finely tuned policy judgments ahead, watching unemployment rises and sticky inflation. JPMorgan leaders note small businesses tackling wage pressures and supply chain improvements.[1][3]

These developments reflect high public interest in Fed guidance and business sentiment amid policy shifts like tariffs and fiscal stimuli.[2][4]