Macroeconomic Barometer — July 2026
eco3min · macroeconomic barometer
Barometer — July 2026
Data as of July 1, 2026
Macro reading — July 2026
June marked a turning point in the energy shock. US inflation kept accelerating — May CPI came in at 4.2% year-over-year (vs 3.8% in April), above 4% for the first time in three years, with energy alone accounting for more than 60% of the monthly increase. But oil collapsed: after its spring peak, Brent fell back to about $73-74 by June 30, down roughly 30% on the quarter — its steepest quarterly drop since 2020 — amid a ceasefire and a recovery in Strait of Hormuz traffic. In the euro area, inflation has already begun to recede: Eurostat’s July 1 flash estimate brings HICP down to 2.8% in June (vs 3.2% in May).
Both major central banks turned more hawkish. The Fed, now chaired by Kevin Warsh, held rates at 3.50–3.75% on June 17 by a unanimous vote but removed its easing bias: the June dot plot puts the year-end 2026 median at 3.8%, up from 3.4% in March, with nine of eighteen participants projecting a rate above the current range. The ECB, for its part, raised its three key rates by 25 bps on June 11 — its first hike since September 2023. On activity, US growth was revised higher: first-quarter 2026 GDP came in at +2.1% at an annual rate (third estimate), up from +1.6% last month, and employment stayed robust (+172,000 in May, with March and April revised up).
The Eco3min regime classifier reads “Transition / Mixed signals”: growth on trend, underlying inflation (Trimmed Mean PCE 2.4%) near target despite still-elevated headline inflation, financial conditions accommodating. All data presented here come from public institutional sources (BLS, BEA, Fed, FRED, Dallas Fed, ECB, Eurostat, Chicago Fed, Richmond Fed, U.S. Department of Labor). No forecast or investment recommendation is made.
Cycle signals — institutional indicators
−0.52
avg. = 0NFCI — Chicago Fed National Financial Conditions Index
A composite of 105 variables (money markets, debt, equities, the banking system). A negative reading indicates financial conditions looser than the historical average since 1971. The index stayed accommodating and broadly stable in June, around −0.52 (vs −0.51 in late May): the pullback in oil, the easing in equity volatility and in credit risk premia more than offset the rise in short-term yields that followed the Fed’s more hawkish tone. Source: Federal Reserve Bank of Chicago via FRED (series NFCI, latest weekly reading available).
0.13
threshold = 0.50Sahm rule — real-time recession indicator
Developed by Claudia Sahm (formerly at the Fed). It measures the gap between the 3-month moving average of the US unemployment rate and its low over the prior 12 months. The 0.50 threshold has historically coincided with the start of every recession since 1950. The real-time May 2026 reading holds at 0.13, unchanged, with the unemployment rate steady at 4.3% for a third consecutive month. Source: FRED, series SAHMREALTIME.
0.015
threshold = 0.20SOS — Scavette-O’Trakoun Sahm-style indicator (Richmond Fed)
A weekly variant of the Sahm rule using the insured unemployment rate. Developed by O’Trakoun (Richmond Fed) and Scavette (Philadelphia Fed), published in Economics Letters 2025. The underlying series is published in our Sahm-rule recession-indicator dataset. Recession threshold: 0.20. The latest published value comes in at 0.015 — well below the threshold; continuing claims edged up (1.82 million in early June, a three-month high) without a break, in a labor market of low hiring and low layoffs. Source: Federal Reserve Bank of Richmond (latest value available — to refresh before publishing).
These indicators are designed to detect recession and financial stress. They are not trading signals. The thresholds mentioned are historical benchmarks, not predictions. Values are subject to revision.
Yield curve spread and the Sahm rule
US yield curve spread (10Y − 2Y) and the Sahm rule. A curve inversion (negative value) has historically preceded most US recessions. The curve is no longer inverted (a +0.30 pp slope as of June 30). The Sahm rule triggers at the 0.50 threshold. Data: FRED (T10Y2Y, SAHMCURRENT).
Sources: Federal Reserve Bank of St. Louis (FRED), Bureau of Labor Statistics
Financial conditions — NFCI
The Chicago Fed’s National Financial Conditions Index and its three sub-indices (risk, credit, leverage). A composite of 105 variables spanning money markets, debt, equities and the banking system. A positive value = historically tighter conditions. Data: FRED (NFCI, NFCIRISK, NFCICREDIT, NFCILEVERAGE).
Source: Federal Reserve Bank of Chicago via FRED
Factual highlights — June 2026
Kevin Warsh’s first FOMC meeting. The Committee held the fed funds range at 3.50–3.75% on June 17 by a unanimous vote — unchanged for a fourth consecutive meeting. The statement, cut to about 130 words (down from more than 300 recently), dropped the detailed vote line and some earlier language; Warsh embraced a stripped-down style with no forward guidance, deemed “not well suited for the current policy conjuncture.” The Summary of Economic Projections raised the year-end 2026 median to 3.8% (up from 3.4% in March): nine of eighteen participants now project a rate above the current range, with one projection missing from the chart (presumably the Chair’s). Warsh also announced task forces to overhaul several Federal Reserve operations. Source: Federal Reserve Board, statement and projections, June 17, 2026.
ECB — first hike since 2023. The Governing Council raised its three key rates by 25 bps on June 11, effective June 17: deposit facility to 2.25%, main refinancing operations to 2.40%, marginal lending facility to 2.65%. It is the first increase since the tightening cycle ended in September 2023. The ECB described the decision as “robust across a range of scenarios” for how the Middle East war might evolve. Updated staff projections raised inflation to 3.0% in 2026, 2.3% in 2027 and 2.0% in 2028 (core 2.5% in 2026 and 2027), and cut growth to 0.8%, 1.2% and 1.5%. Markets price roughly a 50% probability of a further hike in September. Source: ECB, monetary policy decision, June 11, 2026.
Inflation. US CPI for May (released June 10) came in at 4.2% year-over-year (vs 3.8% in April), its highest since April 2023, with core CPI at 2.9% (+0.2% on the month). Energy prices rose 3.9% on the month (+23.5% year-over-year) and account for more than 60% of the headline increase; gasoline is up 40.5% year-over-year. The May PCE price index (BEA, June 25) came in at 4.1% year-over-year, with the core measure at 3.4%. In the euro area, Eurostat’s July 1 flash estimate brings HICP down to 2.8% in June (vs 3.2% in May) — core inflation easing to 2.4% (vs 2.6%) and energy to 8.7% (vs 10.8%). Source: BLS, Consumer Price Index – May 2026; BEA, Personal Income and Outlays, May 2026; Eurostat, flash estimate, July 1, 2026.
Growth. The BEA’s third estimate (June 25) revises US Q1 2026 GDP to +2.1% at an annual rate (vs +1.6% in the second estimate last month), after +0.5% in Q4 2025. The upward revision mainly reflects a downward revision to imports (a subtraction in the calculation of GDP), partly offset by a downward revision to consumer spending. The Q1 PCE price index came in at 4.6% (core 4.4%). In the euro area, Q1 2026 GDP was revised to −0.2% quarter-over-quarter (vs +0.1% in the preliminary estimate), a modest contraction, with France down 0.1%. Source: Bureau of Economic Analysis, GDP (Third Estimate), Q1 2026; Eurostat.
Employment. The May jobs report (released June 5) shows +172,000 payrolls, well above the consensus (~80,000), with upward revisions to March (to +214,000) and April (to +179,000) — 93,000 higher than previously reported. The unemployment rate holds at 4.3%, average hourly earnings rise 3.4% year-over-year. Gains are concentrated in leisure and hospitality, local government and health care, while financial activities declined. Weekly initial jobless claims remain contained (215,000 for the week ending June 20). Source: BLS, The Employment Situation – May 2026; U.S. Department of Labor.
Energy and geopolitics. The conflict opened on February 28 between the United States, Israel and Iran de-escalated: a ceasefire brokered by the United States, Qatar and Iran was announced on June 19, then tested on June 26-27 (drone attacks, strikes, a vessel hit in the Gulf of Oman). The recovery in Strait of Hormuz traffic, sanction waivers granted to Iran and expectations of a supply glut sent oil tumbling: Brent fell back to about $73-74 by June 30 (down roughly 30% on the quarter) and WTI below $70 for the first time since February 27, the eve of the war. On the OPEC side, the United Arab Emirates left the organization effective May 1 and Iraq floated a possible exit. Source: U.S. Energy Information Administration; ICE Futures; news agencies.
Employment — weekly initial jobless claims
Initial jobless claims (ICSA) are released every Thursday by the Department of Labor. The highest-frequency US macro indicator and the earliest warning signal for the labor market, ahead of the monthly jobs report (NFP). For the week ending June 20, 2026, ICSA = 215,000, the lowest in four weeks. Data: FRED (ICSA).
Source: U.S. Employment and Training Administration via FRED
Equity indices — month-end closes
| Index | Level | Closing date | Monthly trend |
|---|---|---|---|
| CAC 40 Euronext Paris | ~8,400 | ≈ 06/30/2026 | ↑ |
| Euro Stoxx 50 Euro area | ~6,326 | ≈ 06/30/2026 | ↑ |
| DAX Deutsche Börse | ~25,000 | ≈ 06/30/2026 | ↑ |
| FTSE 100 London Stock Exchange | ~10,600 | ≈ 06/30/2026 | ↑ |
| S&P 500 NYSE / NASDAQ | 7,449.36 | 06/30/2026 | ↓ |
| Nasdaq Composite US technology | 26,213.72 | 06/30/2026 | ↓ |
| Dow Jones 30 industrials | 52,319.20 | 06/30/2026 | ↑ |
Closing levels for the last trading day of June (06/30/2026). US indices at the official close; European levels indicative (sourced from Yahoo Finance). The second quarter was the best for the major indexes since 2020; in June the Dow set fresh records while the S&P 500 and Nasdaq slipped, in a rotation out of technology stocks. Arrows reflect the trend observed over the month and have no predictive value.
Rates, commodities, volatility
| Asset | Level | Date | Source |
|---|---|---|---|
| US Treasury 2-year Sensitive to Fed expectations | 4.14% | 06/30/2026 | FRED (DGS2) · H.15 |
| US Treasury 10-year Benchmark sovereign yield | 4.44% | 06/30/2026 | FRED (DGS10) · H.15 |
| Spread 10Y − 2Y Curve slope | +0.30 pp | 06/30/2026 | FRED (T10Y2Y) |
| 30-year mortgage rate Freddie Mac | 6.49% | 06/25/2026 | FRED (MORTGAGE30US) |
| HY OAS spread ICE BofA US High Yield | ~2.6% | ≈ 06/30/2026 | FRED (BAMLH0A0HYM2) |
| VIX S&P 500 implied volatility | ~16.3 | ≈ 06/30/2026 | CBOE |
| Gold (spot) USD/oz | ~$4,040 | ≈ 06/30/2026 | London Bullion |
| Brent ICE | ~$74 | 06/30/2026 | ICE Futures / EIA |
| WTI NYMEX | ~$70 | ≈ 06/30/2026 | NYMEX |
Brent (~$74) has fallen back below its pre–February 28, 2026 levels and is down about 30% on the quarter — its steepest quarterly drop since 2020; WTI slipped below $70 for the first time since February 27. The US yield curve has no longer been inverted since the summer of 2024 (10Y−2Y slope of +0.3 pp). Indicative values, subject to revision; month-end market levels.
Policy rates and bond yields
The Fed policy rate (Fed Funds), 2-year and 10-year Treasury yields, and the 30-year mortgage rate. The transmission chain between monetary policy and the real economy. Data: FRED (FEDFUNDS, DGS2, DGS10, MORTGAGE30US).
Source: Board of Governors of the Federal Reserve System via FRED
Credit spread — High Yield
The option-adjusted spread (OAS) of the ICE BofA US High Yield index measures the risk premium investors require to hold high-yield corporate debt over government bonds. As of late June 2026, the OAS comes in around 2.6% (≈ 260 bps) — a historically low level (long-run average ~5.5%), as the geopolitical de-escalation tightened risk premia. Data: FRED (BAMLH0A0HYM2).
Source: ICE Data Indices via FRED
Macroeconomic indicators — latest releases
United States
Euro area
Inflation and expectations
Market-implied inflation expectations: 10-year breakeven (T10YIE) around 2.28% (the gap between nominal and inflation-indexed 10-year yields), 10-year real interest rate (DFII10) at 2.16% (June 29), and the 5Y5Y forward rate (T5YIFR) around 2.3%. The 5Y5Y forward is the Fed’s preferred gauge of long-term expectations anchoring; it remains close to target, with the pullback in oil easing overshoot fears. Data: FRED.
Source: Board of Governors of the Federal Reserve System via FRED
Analytical framework — the month’s factual elements
The data available at the end of June still describe a mixed, transitional configuration, but one marked by a turning point: resilient growth, headline inflation that is still elevated but whose energy driver is deflating sharply, and cycle indicators that stay far from recession thresholds.
On activity: the upward revision of US Q1 2026 GDP, from +1.6% to +2.1% at an annual rate, mainly reflects a downward revision to imports. The rebound from Q4 2025 (+0.5%) is confirmed and stronger than estimated — supported by investment, exports, government spending and consumer spending. In the euro area, by contrast, Q1 GDP was revised to a slight contraction, at −0.2% quarter-over-quarter.
On employment: the May jobs report (+172,000) came in well above expectations, with upward revisions to March and April — a clear reversal of the mostly downward revisions of 2025. The unemployment rate holds steady at 4.3%. Weekly claims (215,000 on June 20), the Sahm rule (0.13) and the SOS stay far from their respective thresholds, even as continuing claims edged up: the dynamic remains one of a labor market with low hiring and low layoffs.
On inflation: US CPI for May (4.2%) rose to a three-year high, but that figure predates the late-June collapse in oil; energy accounts for more than 60% of the monthly increase. The underlying gauge favoured by the Eco3min classifier — the Trimmed Mean PCE — remains at 2.4%, near target: it is this gap between felt (headline) inflation and persistent inflation that underlies the regime’s divergence flag, now easing as Brent recedes. In the euro area, HICP has already begun to fall back (2.8% in June). Long-term expectations (5Y5Y forward around 2.3%) stay anchored.
On central banks: both major institutions turned more hawkish. The Fed, chaired by Kevin Warsh since May 22, held rates on June 17 but removed its easing bias, the dot plot now leaning toward a hike rather than a cut by year-end 2026. The ECB raised rates by 25 bps on June 11, its first hike since 2023, and decides again on July 24. The common tension: balancing an ongoing energy disinflation against the risk of second-round effects, against a backdrop of resilient US growth.
Key items to watch — July–August 2026 calendar
Net liquidity — Fed balance sheet, TGA, reverse repo
Net liquidity equals total Federal Reserve assets (WALCL) minus the Treasury General Account (TGA) balance and reverse repo operations (RRP). As of June 24, 2026, total assets come in around $6,736B, the TGA around $919B and the RRP near zero (~$2B), for net liquidity of about $5,815B. The RRP remains near zero; the TGA, swollen by the spring tax season, mechanically weighs on net liquidity. Data: FRED (WALCL, WTREGEN, RRPONTSYD).
Sources: Federal Reserve, U.S. Treasury via FRED
Explore on eco3min.fr
Monetary policy Yield curve Liquidity & financial conditions Financial markets Commodities Macroeconomics & geopoliticsThis barometer is published monthly by eco3min.fr. It compiles data from public institutional sources (FRED, BLS, BEA, Fed, ECB, Eurostat, Chicago Fed, Richmond Fed). The cycle and financial-conditions indicators are presented with their documented definitions and historical thresholds, with no predictive interpretation.
Disclaimer. The data, charts and indicators presented on this page are provided for strictly informational and educational purposes. They are drawn from public data (FRED, BLS, BEA, ECB, Eurostat, Chicago Fed, Richmond Fed) and may be subject to delays, revisions or errors. They do not constitute investment advice, personalised recommendations, a solicitation to buy or sell any financial instrument, or a predictive analysis of the economic cycle. eco3min.fr is not an authorised financial institution and does not provide investment advisory services within the meaning of applicable regulations (MiFID II; Articles L.541-1 et seq. of the French Monetary and Financial Code). Any investment decision is the sole responsibility of the investor, who is encouraged to consult an authorised professional. Past performance is not indicative of future results. The market values cited are indicative and may differ from real-time prices.
Last updated — 2 July 2026
Disclaimer – Financial Information: The analyses, commentary, and content published on eco3min.fr are provided for informational and educational purposes only. They do not constitute investment advice or a solicitation to buy or sell financial instruments. Past performance is not indicative of future results. All investment decisions involve risk and are the sole responsibility of the reader.