November 10, 2025

Hi, everyone. This is Taylor St. Germain with ITR Economics. Thanks for joining me on this episode of TrendsTalk. We at ITR are your apolitical and unbiased source of economic intelligence. Today, I’m tuning in from Chicago where I’m giving a presentation, and I wanted to provide an update on uncertainty.

A lot of our speakers and economists at ITR Economics have been sharing the US Economic Policy Uncertainty Index. It’s been a very important index for us to track throughout this year because of the geopolitical challenges, because of tariffs, and the uncertainty that has resulted from it. What I often share is when we look at the uncertainty index, in March and April of 2025, we saw uncertainty soar to a record high. We were actually more uncertain in the early part of this year, in the first half of this year, than we were at the height of the pandemic, at least according to the data for this uncertainty index. There were a lot of implications of this, which is businesses paused in their business investment. We were seeing demands sluggish to pick up in the first half of the year.

But I’m coming to you all with good news today, which is we are starting to see the uncertainty subside. So the index value was well above a value of 800 back in the first half of this year. When we look at where the most recent reading of this uncertainty index is, it’s below a value of 400, meaning our uncertainty has essentially been cut in half when we look at the data today compared to the first half of the year. And there’s been positive developments in the data that have resulted from this, which is we are seeing US Nondefense Capital Goods New Orders, our CAPEX benchmark, has not only transitioned to rise, but as that is actually in a period of accelerating growth. We’re seeing the US Industrial economy also transition to accelerating growth. So there’s been important developments that have happened due in part to this uncertainty starting to subside.

Now, it’s very important from a modeling perspective that we watch this index. Because as many of you know, ITR Economics is forecasting economic growth, especially in terms of CAPEX and Industrial Production, to continue to accelerate into 2026. And we need uncertainty to continue to subside, otherwise it’d be a risk to those forecasts. And that is exactly what’s happening today. So again, I hope you find that this is encouraging news. Now, I’m not suggesting uncertainties back to normal. We’re still elevated compared to where we were in 22, 23, and 24. But again, making a lot of progress to see this uncertainty essentially slashed in half from where we were compared to the first half of the year.

This is an index that we’re updating frequently and watching closely, and we’ll continue to provide you updates on this. But our leading indicators are still pointing in the positive direction for 2026. We have uncertainty subsiding. Our weekly economic index from the Dallas Federal Reserve continues to show the US economy growing at a healthy 3%. This is all encouraging news, and it all highlights why maybe the media likes to talk about a recession for next year, but that’s certainly not what we see. So there’s positive developments in the data, even with things like tariffs and the government shutdown going on. And that’s my message to you all is ignore the political noise, continue to watch the data, because I think you’ll find we’re a lot more optimistic when we’re looking at the data than we are when we’re looking at what’s going on in the media.

I’ll continue to update you on these important economic indicators as we move later into this year, but we should be preparing for growth. And my question is not whether it will grow in 2026, it’s whether you all can keep up with that growth.

Thanks so much for joining me on this episode of TrendsTalk. Please like and subscribe to TrendsTalk wherever you listen to your podcast. I look forward to seeing you all in the next one. Thanks so much. Take care for now.