U.S. accelerates and the yield curve rebounds
The U.S. economy is showing clear signs of improvement. Two data points illustrate this: first, the Citigroup economic surprises index has advanced more than 40 points so far this year, reaching levels not seen in two years. Second, the January 2026 ISM manufacturing index rose by 4.7 points, entering expansion territory and marking its best level since August 2022.
Models from the Federal Reserve banks of New York and Atlanta already reflect this momentum, signaling an acceleration of GDP in late 2025 and early 2026. In this scenario, members of the Federal Open Market Committee (FOMC) are in no hurry to cut interest rates, and the yield curve has shifted upward by about 10 basis points so far this year.
Source: TradingView, 5 February 2026
Kevin Warsh: independence and orthodoxy for the Fed
The nomination of Kevin Warsh has reduced market uncertainty. Pending Senate confirmation, Warsh’s profile suggests a Fed that will move away from the excessive market intervention seen in recent years. A proponent of monetary orthodoxy, Warsh seeks a “boring” institution that drastically reduces its balance sheet and avoids constant market intervention.
