Read the highlights of this week’s commentary from Helios:
- The Fed’s October Beige Book showed weakening economic momentum, with just 3 of 12 districts reporting growth. Consumer spending edged down despite a spike in EV purchases ahead of the federal tax credit expiration, and labor markets softened with more employers reducing headcount through layoffs and attrition.
- Regional bank stocks sank after Zions Bancorp reported a $50 million fraud-linked loan loss and Western Alliance filed its own fraud lawsuit. Though seen as isolated, the news reignited fears of hidden credit stress, especially after recent bankruptcies. The fallout may pressure valuations and tighten lending for small businesses.
- The IMF lowered its global growth forecast to 3.2% for 2025 and 3.1% for 2026, citing rising downside risks. The U.S. economy is slowing despite strong Q2 GDP growth, which was driven more by inventory buildup than underlying demand. Trade tensions, policy uncertainty, and weakening long-term growth prospects may drive market volatility and currency swings as central banks diverge.
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