Read the highlights of this week’s commentary from Helios:
- US retail sales jumped 1.4% in March, driven by strong auto and building material purchases, likely in response to anticipated tariffs. Restaurant spending also rebounded after a sluggish start to the year. However, spending in other categories remained modest, suggesting that consumers remain cautious amid continued uncertainty around tariffs.
- US factory output rose 0.3% in March, driven by strong auto and aerospace production. Manufacturing grew 5.1% in Q1, the best since 2021, as businesses ramped up orders ahead of new tariffs. Overall industrial production slipped due to lower utility output. Rising material costs and trade policy uncertainty may weigh on future growth as companies hold off on new investments.
- The Philadelphia Fed’s April survey showed manufacturing activity fell sharply, with the headline index dropping to -26.4 — the steepest decline in two years. New orders and shipments turned negative, and hours worked declined. Firms also reported rising price pressures, both current and expected. Along with similar data from the New York Fed, the survey suggests the ISM manufacturing PMI may show deeper contraction in April.
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