Will Trump See a Faster Growing US Economy in 2026? 5 Factors to Watch Closely

As we move into 2026, many are asking the same big question: Will Trump see a faster growing US economy in 2026? After a highly active first year of his second term, the dust is beginning to settle on some of his most aggressive policies. While 2025 was marked by significant trade shifts and fiscal changes, 2026 is shaping up to be the year where these strategies either bear fruit or face their toughest hurdles. To understand if we are heading toward a boom or a slowdown, we have to look at the 5 factors to keep an eye on that will ultimately dictate the strength of the dollar and the comfort of the American consumer.

1. The Federal Reserve and the Fate of Jerome Powell

One of the most critical variables in the quest for a faster growing US economy in 2026 is the leadership at the Federal Reserve. Fed Chair Jerome Powell is approaching the end of his term in May 2026, and the tension between the White House and the central bank has been a major headline. President Trump has frequently voiced his desire for more aggressive interest rate cuts to stimulate growth. Whether Powell finishes his term or a new, more "dovish" chair is appointed, the shift in monetary policy will be one of the top 5 factors to keep an eye on. Lower rates could spark a surge in housing and business investment, but they also risk reigniting inflation.

2. The Reality of Trade Tariffs and Supply Chains

Trade policy has been the cornerstone of the "America First" agenda, and it continues to play a massive role in whether we see a faster growing US economy in 2026. By the end of 2025, average tariff rates had climbed to nearly 15 percent, a level not seen in decades. While these tariffs are designed to protect domestic industries, they also raise costs for businesses that rely on imported parts. As we look at the 5 factors to keep an eye on, the stability of these trade deals is paramount. If the administration can negotiate bilateral agreements that lower uncertainty while maintaining protectionist goals, the market might finally find the predictability it craves to invest for the long term.

3. Boosting GDP Through Fiscal Stimulus

The administration’s "One Big Beautiful Bill" has already started pumping money back into the hands of consumers and corporations. Many economists believe this fiscal loosening is a primary reason why we might witness a faster growing US economy in 2026. With provisions like accelerated depreciation for businesses and tax refunds for individuals, the goal is to keep the GDP moving upward. This injection of cash is another of the 5 factors to keep an eye on because it acts as a direct counterweight to the potential drag of higher import costs. If consumers keep spending, the momentum could carry the economy through any rough patches in global trade.

4. Energy Prices and Deregulation

A major part of the strategy for a faster growing US economy in 2026 involves making it cheaper to do business in America. By simplifying permits and pushing for an increase in oil and gas production, the administration hopes to lower energy costs significantly. This move toward deregulation is one of the 5 factors to keep an eye on that could provide a massive tailwind for manufacturing and transport sectors. Lower fuel and electricity prices act like a "stealth tax cut" for every household and factory in the country, potentially boosting disposable income and lowering the cost of goods across the board.

5. The Artificial Intelligence Productivity Boom

Finally, we cannot ignore the role of technology in achieving a faster growing US economy in 2026. The massive investments in AI and data centers that began years ago are expected to finally show up in productivity data this year. As businesses find ways to do more with less, this technological edge becomes one of the most exciting 5 factors to keep an eye on. If AI can help offset the labor shortages caused by stricter immigration policies, it could be the "X-factor" that keeps the US at the top of the global growth table.