Read the highlights of this week’s commentary from Helios:
- In a much-needed reprieve from inflation, the consumer price index (CPI) fell for the first time in six months, increasing by 0.3% in April and by 3.4% over the past year. Core CPI, which excludes the more volatile food and energy components, rose 0.3% in April and 3.6% from last year. The softer inflation report raises the possibility of a rate cut this year, although officials, including Chair Powell, emphasize patience and further data confirmation before any rate changes.
- For the first time ever, the Dow closed above the 40,000 mark on Friday. Historically, the Dow averages a 4.3% gain in the month after crossing a 10,000-point milestone, higher than its average one-month gain of 0.57%. This milestone comes alongside fresh records on the S&P 500 and the Nasdaq, driven by strong earnings and renewed hopes for Federal Reserve rate cuts.
- US household debt reached a record high of $17.7 trillion in the first quarter of 2024, rising by $184 billion (1.1%) from the previous quarter, according to the Federal Reserve Bank of New York. This increase is largely driven by inflation, which has pressured families to rely on credit cards for necessities. The report showed 3.2% of debt in delinquency as of March 2024. While this is 1.5 percentage points lower than in Q4 2019, delinquency rates are rising, especially among those using over 60% of their available credit.
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