Six-month outl
Financial conditions are likely to remain loose but may tighten slightly as the Federal Reserve keeps policy restrictive. With inflation trending lower and growth moderating, the NFCI could move toward –0.45 by mid‑2026. Persistent demand for risk assets may keep conditions easy, but rising bond supply and a shift toward normalization could temper exuberance.
Signal
Yellow – Financial conditions are extremely loose and supportive, but such easy conditions could make assets vulnerable to shocks. While no immediate stress is evident, investors should monitor for signs of tightening.
