Read the highlights of this week’s commentary from Helios:
- In March, US retail sales increased by 0.7% from February, a 4.0% rise from the previous year, indicating strong consumer spending despite economic uncertainties. February’s retail sales figures were revised upward from 0.6% to 0.9%, suggesting a stronger economic foundation than initially anticipated.
- Recent disappointing inflation data has led the Federal Reserve to re-evaluate the timing of its initial interest-rate cut and reassess inflation trends, indicating a longer wait than initially expected for rate reductions. Some Fed officials believe that current interest rates are at their peak, yet others remain open to increasing rates if necessary to control inflation. Chair Jerome Powell emphasized the need for greater confidence before lowering rates, hinting at possibly fewer cuts this year.
- Stock markets, already poised for correction, are showing signs of increased selling pressure in response to the geopolitical escalations and their implications for global economic stability. The S&P 500 has lost 4.6% since hitting its record close on March 28, while the tech-heavy Nasdaq has shed 5.5% over just the last five sessions, its largest five-day percentage decline since December 2022.
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