US Inflation Expectations Drop Again, New Low For Sixth Straight Month

The University of Michigan survey on year-ahead inflation expectations reported another new low for Feb. 2026 at 3.5%, the lowest reading since Jan. 2025, and a contninuation from the last five months of reported lows. This report of 3.5% is a 0.5% drop from Jan. 2026, a 0.8% drop from Feb. 2025, and a 1.3% drop from the beginning of the initial decline back in Aug. 2025, which reported at 4.8%. 

Feburary's numbers also continue the trend of beating the forecast, as for Feb. 6, they reported 0.5% under the forecast of 4.0%, and the report prior, Jan. 2026 came in at 0.2% under the forecast with 4.0%. With consumer sentiment trending in the right direction, we look to be on track to return to the readings we saw in 2024, ranging from 2.6%-3.2%, and even the pre pandemic lows from 2018-19 which sat almost entirely below 3%.

Source: https://tradingeconomics.com/united-states/michigan-inflation-expectations

Private Sector hiring slumped in January, adding just 22,000 Jobs

 In January 2026,  U.S. private sector hiring was much smaller than what economists originally expected. According to the ADP National Employment Report, private sector businesses only added about 22,000 jobs, instead of the 45,000 jobs that were forecasted for the month. Most of the job gains came from the education and health services fields due to the aging population. The business field saw a significant loss of 57,000 jobs, which is the sharpest decline for that sector since August 2024. 

Economists are seeing this trend as part of a broader labor market slowdown that has been persistent over the last few years, where hiring is moderate and concentrated in just a few sectors. The report also said that the wage growth rate stayed relatively stable despite the slowdown. Elizabeth Renter, the chief economist with NerdWallet wrote in a note that, "weak and highly concentrated growth in the labor market translates to weaker growth across the economy." (Renter). 

https://www.cnn.com/2026/02/04/economy/us-adp-private-sector-jobs-january 

 

How U.S. trade uncertainty is buffeting small business

Small businesses make up about a third of U.S. international trade and employ almost 46% of American workers. Even though they play a key role in the economy, new research from Harvard Business School shows that many small and medium sized companies are struggling to survive as U.S. trade policy becomes more unpredictable.

A survey of over 4,000 small and medium-sized businesses found that quick changes in tariffs, being announced, delayed, withdrawn, and brought back, make it almost impossible for owners to predict costs, set prices, or sign long-term supplier contracts. Researchers say this uncertainty acts like a tax, making businesses delay hiring, put off investments, or rethink expanding.

Small businesses usually don’t have the cash reserves, legal help, or flexible supply chains that big companies do to handle sudden policy changes. Many depend on imported materials and can’t easily switch to domestic options, which are often more costly or hard to find. As a result, trade volatility hits smaller firms harder.

What stands out to me is not just the tariffs themselves, but how unstable they are. Even businesses willing to pay more can’t operate effectively when the rules keep changing. Economic policy does not happen in isolation; consistency is just as important as intent.

This uncertainty also gives bigger companies more power. Businesses with lawyers, consultants, and global supply chain experts can adapt more easily, while smaller firms are left to react rather than plan. Over time, this creates an uneven playing field that helps large corporations and makes it harder for small businesses to compete.

The effects go beyond just financial numbers. Small businesses are closely connected to their communities as employers, service providers, and sources of local stability. When they cut back or close, it leads to job losses, reduced access to goods and services, and fewer opportunities for people to move up economically.

Whether you support or oppose tariffs, the research shows one clear point: a predictable trade policy is important. Without a stable, clear system, uncertainty stunts growth and survival, especially for small businesses, the backbone of the U.S. economy.

https://www.hbs.edu/bigs/us-trade-uncertainty-buffeting-small-business

Trump Responds to EU-India Trade Deal with His Own

 The U.S. and India announced a huge trade overhaul that greatly affects global economic ties. President Trump and PM Modi agreed to cut reciprocal tariffs to 18% which is down from highs of 25 - 50%. This new 18% on tariffs for India is lower than both Vietnam's (20%) and China's which is a lot higher. A reason for this is that the U.S. is trying to move supply chains away from China, so giving India a lower tariff India becomes a very attractive place for companies to build their products. As part of the U.S. - India deal, India is committing to buying $500 billion worth of American products (oil, fam goods, etc.) and will also stop purchasing crude oil from Russia.

This comes right after India signed a similar deal with the European Union (EU). This shows just how much India is attempting to diversify their partners and increase their global economic connections. Overall, this deal is beneficial to both parties with the U.S. moving toward reciprocal trade, while India obtaining more market access to a larger export partner.

Citation: https://www.cnbc.com/2026/02/03/trump-us-india-trade-deal-europe-india-deal-compared.html

US Edu department proposes overhaul of Federal student loans, sets new caps on graduate borrowing

The U.S. Department of Education is proposing major changes to federal student loans, mainly for graduate and professional students. One of the biggest changes is eliminating the Grad PLUS loan program, which currently allows students to borrow almost unlimited amounts. Instead, the government wants to set clear limits on how much students can borrow each year and overall. Graduate students would have lower borrowing caps, while students in professional programs like law or medical school would be allowed higher limits. The goal is to prevent students from taking on overwhelming debt.

These changes are meant to make student loans simpler and more affordable in the long run. By limiting how much students can borrow, the government hopes to slow rising tuition costs and reduce financial stress after graduation. The plan would also simplify repayment by reducing the number of repayment options, making loans easier to understand and manage. The proposal is not final yet and is open for public comment, but if approved, it could significantly change how students pay for higher education.

Citation : https://www.edexlive.com/news/us-edu-department-proposes-overhaul-of-federal-student-loans-sets-new-caps-on-graduate-borrowing?utm

China and the U.K. Resetting Economic Ties

China and the United Kingdom are taking steps to rebuild their relationship after years of tension. The U.K. prime minister’s visit to China, the first in eight years, signals a shift toward renewed economic cooperation. Both sides discussed expanding trade and collaboration in areas such as finance, artificial intelligence, and clean energy.

The U.K. is also trying to diversify its trade partners amid global economic uncertainty and changing U.S. trade policies. While security concerns still exist, the visit shows that economic stability and long term growth are key priorities for both countries.

https://www.cnbc.com/2026/01/29/china-uk-starmer-xi-relations-visit-businesses-.html

U.S.–Europe Trade Tensions Escalate Over Greenland

In January 2026, a serious trade dispute happened between the United States and several European countries after Donald Trump threatened to impose new tariffs tied to the situation in Greenland. Trump said he would begin applying a 10% tariff on imports from eight European nations on February 1, potentially rising to 25% by June. Unless those countries agreed to talks about Greenland, which is a territory of Denmark. This proposal alarmed European leaders, who called the threats “unacceptable” and held emergency meetings in Brussels to coordinate a response. European officials also talked about the idea of using the Anti-Coercion Instrument (ACI) which is a tool designed to allow the European Union to fight back economically when countries use trade threats to force political decisions.

While some European leaders support doing so, others are more cautious about escalating the conflict. France argues the EU must be ready to use the ACI, while countries like Germany are more hesitant because they rely heavily on exports and are concerned about worsening trade relations. Although European leaders hope to use upcoming meetings, such as the World Economic Forum in Davos, to ease tensions through dialogue, economists warn that uncertainty could last for months. This is expected to hurt European economic growth and create continued instability in trade relations.

https://www.cnbc.com/2026/01/19/europe-retaliatory-tariffs-aci-greenland-trump-threat-us.html

How U.S. midterm elections cay affect markets

 This article posted on January 22 explains that even with many dramatic global events happening in 2026, investors should still pay attention to the upcoming U.S. midterm elections. Historically, the president's party usually loses seats in Congress during midterms, but the authors state that the white house is attempting to limit those loses with political message. Another point they make is that election years can cause markets to shift aggressively both up and down. 

The authors make a point to investors to not panic about political noise. The authors emphasize that markets have a long history of becoming calmer and performing better after midterm elections once the results are known. They encourage people to focus on long‑term fundamentals like company earnings and economic trends rather than short‑term headlines or political drama even though these short swings don't tend to change long term trajectories.

https://www.capitalgroup.com/advisor/insights/articles/midterm-elections-markets-5-charts.html 

Major investment in OpenAI from Nvidia

 Nvidia CEO Jensen Huang says that the company plans on making a "huge" investment in OpenAI, the company behind ChatGPT. There were claims going around that Huang was unhappy with OpenAI, which he has denied. The deal is invest up to $100 billion dollars into ChatGPT, allowing them to finance advanced chips. This will allow Chat to remain one of the largest generative AI platforms amidst a very competitive field.

Huang says that he "believe[s] in Open AI", going even further to call their work "incredible." I don't know what Nvidia would get in return for this, but a trade deal as large as this would no doubt launch both company's stocks much higher. It is clear that Nvidia wants to remain a large factor in AI development and they are willing to pay to see the future of AI explode.

Article: https://www.cnbc.com/2026/01/31/nvidia-ceo-huang-denies-hes-unhappy-with-openai.html

Gold and Silver Prices Fall as Investor Expectations Shift

    Gold and silver prices fell sharply following President Trump's nomination of Kevin Warsh for Federal Reserve Chair. According to this article, the fall was caused by a strengthening U.S. dollar and shifting investor expectations. Since precious metals are considered a safe-haven asset, dramatic drops in their prices signals that investors perceive less risk. This highlights how expectations play a major role in business cycles. Investors appear to have taken the nomination as a sign that monetary policy will become more predictable, reducing the need to hold safe assets like gold and silver. 

    When interest rates are expected to rise, investors prefer assets like bonds that pay interest, instead of assets like gold that do not. Because of this, they move money into U.S. investments, that increasing demand strengthens the dollar. A stronger dollar often results in increased imports and decreased exports, which reduces net exports and slow GDP growth. 

ARTICLE: https://www.cnbc.com/2026/01/30/silver-gold-fall-price-usd-dollar-fed-warsh-chair-trump-metals.html