Abacoa & Alton Neighbors - July 2026

12 A B A C O A & A LT O N N E I G H B O R S | J U LY 2 0 2 6 - By Jeremy L. Wilmes MBA, CFP,®ChFC®CLU,®CASL, RICP® - Economic Update FOR JULY A s we reach the midpoint of 2026, the U.S. economy continues to move forward, just at a more deliberate pace than we've become accustomed to over the past few years. The rapid acceleration that followed the pandemic recovery has given way to a more sustainable rhythm, with economists projecting growth of roughly 2% this year. One of the biggest influences remains the Federal Reserve. While inflation has cooled significantly from the highs of recent years, it hasn't fully returned to the Fed's long-term target. As a result, policymakers continue to walk a careful line control. Investors hoping for a rapid series of rate cuts may need to exercise patience. The labor market tells a similar story. Hiring remains healthy, but the breakneck pace of job creation has slowed. Unemployment has drifted modestly higher from historic lows, suggesting the economy is normalizing rather than weakening. In many ways, this moderation reflects a transition from "exceptional" growth back toward "typical" growth. Meanwhile, global events continue to remind investors that uncertainty is a permanent feature of markets. Ongoing tensions in the Middle East and fluctuating energy prices have the potential to influence inflation, consumer spending, and investor sentiment. While these developments deserve attention, history has repeatedly shown that markets often adapt more effectively than headlines suggest. One reason for continued optimism is the remarkable level of investment taking place across technology, artificial intelligence, and productivity- enhancing innovation. Businesses continue to deploy capital toward solutions that improve efficiency and create long-term value. Combined with generally healthy corporate balance sheets, these investments may help support economic growth even as conditions become more challenging. THE TAKEAWAY The economy appears to be shifting from rapid expansion to steady progress. Growth may be slower, but slower does not necessarily mean weaker. For long-term investors, periods like these often reinforce the importance of focusing on quality companies with strong balance sheets, reliable cash flow, competitive advantages, and the ability to adapt to changing conditions. The headlines may continue to change. Sound investment principles rarely do. Securities and investment advisory services offered through Osaic Wealth, Inc. Member FINRA/SIPC. Osaic Wealth is separately owned, and other entities and/or marketing names, products, or services referenced here are independent of Osaic Wealth. Mid-Year Market Compass: Steady Seas, Shifting Winds EXPERT CONTRIBUTOR