In early December, the emergence of the Omicron COVID-19 variant pushed Goldman Sachs to cut growth forecasts for 2022 amid uncertainty, but the good news is that the new variant will only be a “modest drag” on spending. The bank revised its U.S. gross domestic product growth outlook to 3.8% for 2022, which is only slightly down from its previous 4.2% projection for the full year.

There are other signs pointing to continued growth in 2022.

The stock market is showing resilience.

Despite bouts of volatility since the onset of the pandemic, most recently as a response to the surfacing of Omicron, the stock market has bounced back repeatedly, and faster with each dip. Within just a week, the S&P 500 had already returned to its Thanksgiving level, when the news of the new variant was first announced. The index is up more than 26% for the year as of early December.

Looking forward, Wall Street strategists anticipate that stocks will continue to rise in 2022 fueled by earnings growth. Ed Yardeni of Yardeni Research is predicting new record highs for the S&P 500.

The labor market is tightening.

The unemployment rate fell to 4.2% in November from 4.6% the prior month, after climbing to 14.8% in April 2020 due to the pandemic-related shutdowns. Employment has recovered much faster than after prior recessions. The fall in joblessness is indicating a thriving economy and bodes well for consumer spending in the near future.

Higher rates of job creation were seen in several parts of the economy, including professional and business services, transportation and warehousing, and construction. At the same time, Americans continue to quit their jobs at a high rate, contributing to the already tight job market.

Mortgage delinquency rates and foreclosures are falling.

Americans are paying their mortgages on time, prompting the overall delinquency rate on mortgages to be at its lowest point since the beginning of the pandemic. The Federal Reserve’s easy monetary policy has pushed housing prices and home equity to record levels, which has helped drive down delinquencies. Only 4% of mortgages were delinquent in August, according to the most recent data from CoreLogic Loan Performance Report. This is down from 6.6% in August 2019.

Companies are paying their debt and avoiding bankruptcies.

The credit market environment is thriving and there have been no U.S. companies defaulting since July amid robust capital markets access. The U.S. high-yield default rate is at its lowest since 2007, standing at just 0.4% in November, according to Fitch Ratings. An uptick in the corporate default rate in the US going forward is highly unlikely, and even if defaults increase, Fitch anticipates the rate will remain low at around 1% in 2022.

From a global perspective, the default rate has also been on the decline and is expected to continue to fall in 2022, hitting 1.6% by the end of April, well below the long-term average of 4.2%, according to data from credit rating agency Moody’s.

The treasury yield curve is flattening … but not inverting.

The flattening of the yield curve, which has been taking place in November and December, isn’t ideal. However, it’s not cause for undue concern either. In a thriving economic environment, long-dated treasury rates are higher than short-dated ones, while an inverted curve, when short-dated yields are higher than long-dated ones, usually announces an economic slowdown. The good news is that so far the curve hasn’t inverted and the spread between two-year and 10-year treasury yields remains at about 80 basis points off inverting. This indicates that a recession isn’t an immediate risk, as a Reuters columnist recently wrote.