A plurality of Americans anticipates improvement in the stock market and overall economy over the next six months, though pessimism prevails regarding unemployment and inflation, according to a new Gallup poll.
Views on interest rates lean slightly toward a decline.
The survey, conducted January 2-17, asked U.S. adults to predict changes in five key economic indicators: whether each would rise significantly, rise modestly, remain unchanged, fall modestly, or fall sharply.
For the stock market, 50% expect an increase compared to 25% predicting a decrease, with 17% seeing no change. On economic growth, 49% foresee gains versus 36% expecting declines, and 13% anticipate stability.
Interest rate expectations are nearly split, with 41% predicting a drop and 36% an uptick, while 20% expect rates to hold steady. In contrast, 62% believe inflation will rise, far exceeding the 26% who expect it to ease and the 9% who expect no change.
For unemployment, 50% predict a rise, against 32% forecasting a reduction, and 16% no change.
Gallup has tracked these sentiments sporadically since October 2001, with monthly updates through late 2005 and 11 measurements since. The poll excluded the 2007-2009 recession.
Compared to April 2025, when trade tensions from President Donald Trump’s tariffs on major U.S. partners sparked uncertainty, current outlooks have rebounded. Stock market optimism jumped 21 points from 29% to 50%, while pessimism dropped 33 points to 25%. Economic growth positivity rose from 38% to 49%. Interest rate views shifted from a slight bias toward increases to a bias favoring decreases.
Yet these figures fall short of January 2025 peaks, when Republican enthusiasm for Trump’s incoming administration drove stock optimism to 61% and growth to 53%. Inflation expectations, historically elevated, peaked at 79% in 2022, dipped to 52% in January 2025, then rose to 63% in April and are now at 62%.
Unemployment pessimism has worsened, rising 12 points from January 2025 to 50%.
Partisan divides are stark. Republicans overwhelmingly predict positives: 82% for growth, down to 59% for inflation (interpreting lower inflation as positive). Democrats split evenly on stocks but lean negative elsewhere, with 86% expecting higher inflation and 49% for interest rates. Independents align more closely with Democrats.
Republicans’ current views mirror their January 2025 optimism but exceed those in April. Democrats and independents show deterioration from a year ago, though some gains from spring.
Overall, public sentiment reflects a blend of progress and pressure: market and growth recoveries from last year’s volatility have not yet matched prior highs, amid broad expectations of persistent inflation and rising unemployment.
