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National Bank of Canada (NBC) economist Jocelyn Paquet has projected U.S. GDP growth of 2.5% in 2026 and 2.1% in 2027, despite ongoing Middle East conflicts and elevated oil prices. The analysis suggests the U.S. economy's resilience stems from strong labor markets, consumer spending, and fiscal policy support. While energy shocks typically slow growth, Paquet argues that inflation risks remain manageable due to offsetting factors like energy efficiency gains and global supply adjustments. For markets, this outlook could influence Federal Reserve policy decisions. A stable growth trajectory might delay rate cuts, maintaining pressure on the USD and affecting global capital flows. Traders should monitor upcoming Fed statements and economic data releases for confirmation of this thesis. The analysis also highlights the interplay between oil prices and macroeconomic indicators, which could impact energy-linked assets and equity sectors. Investors in the MENA region should consider how U.S. economic resilience affects oil demand and regional trade balances. Higher oil prices may benefit Gulf economies but could also increase import costs. Key watchpoints include OPEC+ production decisions, U.S.-China trade dynamics, and the pace of global energy transition. Energy commodity positions and USD exposure in Gulf portfolios may require rebalancing based on these factors.
