From the Desk - Economic Commentary
Scott Hofer, Member Strategies Manager - 2/24/2026
U.S. equities are attempting to rebound this morning after Monday’s broad selloff driven by tariff worries and AI-disruption concern that pressured major tech cyclicals. Regarding economic releases this morning, the most recent ADP Employment Change data shows that U.S. private sector hiring continued to firm through early February, with employers adding an average of 12,750 jobs per week over the four weeks ending February 7, marking the fourth consecutive week of strengthening gains.
In housing, the FHFA house price index showed U.S. home prices rose 0.1% in December, marking a slowdown from November’s 0.7% increase, while year over year growth eased to 1.8%, down from 2.1% the prior month. Prices were 0.8% higher in Q4 2025 compared with Q3, reflecting continued, though moderating, appreciation. The deceleration was influenced by slightly increased housing supply and falling mortgage rates, with the average 30 year fixed rate dipping to 6.19%. Regionally, declines in the West Central and East South Central areas offset gains in stronger markets such as the Middle Atlantic and Mountain regions.
The latest S&P Case Shiller 20 City non seasonally adjusted home price index showed that year over year price growth held at 1.4% in December, unchanged from the prior month, signaling continued but subdued appreciation across major metropolitan markets. Monthly results were essentially flat on an unadjusted basis, reflecting a market that is stabilizing rather than accelerating as higher mortgage rates and affordability pressures continue to weigh on demand. Chicago, New York, and Cleveland remained among the strongest performers with mid single digit annual gains, while several Sun Belt metros continued to cool, underscoring widening regional divergence in home price momentum.
Regarding consumer confidence, the Conference Board reported that U.S. consumer confidence in February edged higher, with the headline index rising to 91.2, up from a revised 89.0 in January, signaling a modest rebound following last month’s steep decline. Despite this improvement, confidence remains well below late 2024 levels, and the underlying details show a mixed picture: consumers’ Present Situation Index slipped to 120.0, reflecting slightly weaker assessments of current business and labor market conditions, while the Expectations Index rose to 72.0, indicating somewhat less pessimistic views about income, business conditions, and job prospects over the next six months—though still below the threshold that often signals recession risk.
Finally, U.S. wholesale inventories continued to grow at a modest pace, with the most recent data showing a 0.2% month over month increase in December 2025, bringing total inventories to approximately $917.2 billion, in line with market expectations and matching November’s growth rate. Durable goods inventories rose 0.3% while nondurable inventories were unchanged, reflecting a mixed but stable inventory environment. On a year over year basis, inventories were up 2.8%, indicating gradual stock accumulation over the past year. The broader manufacturing and trade inventories report for November also showed a slight 0.1% monthly increase, reinforcing the picture of steady but subdued inventory expansion heading into 2026.
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