This material includes forward-looking statements subject to risks and uncertainties; actual results may differ.
Consumer Sentiment Hits New Low
U.S. consumer sentiment fell to a record low in May as rising oil prices and ongoing tensions from the U.S.-Iran war fueled fears of broader inflation. The University of Michigan sentiment index dropped to 44.8, marking the third consecutive monthly decline and falling below the previous low reached in 2022. Inflation expectations continued climbing, with consumers now expecting 4.8% inflation over the next year and growing concern that higher prices will spread beyond energy costs. Rising inflation worries have also pushed Treasury yields higher and reinforced the Federal Reserve's cautious stance on cutting interest rates.
House Advances Housing Affordability Bill
The United States House of Representatives overwhelmingly passed a bipartisan housing affordability bill aimed at limiting large investors from purchasing single-family homes while still allowing them to build additional housing units. Lawmakers removed a controversial provision that would have forced major investors owning 350 or more units to sell newly built rental homes within seven years, helping the bill gain support from the housing and construction industries as well as the White House. The revised legislation now faces uncertainty in the United States Senate, where some lawmakers argue the softer restrictions weaken efforts to expand homeownership for younger Americans. Senators, including Bernie Moreno, contend that discouraging large-scale build-to-rent developments is necessary to increase access to single-family homes and promote generational wealth creation.
Oil Drops on Iran Deal Optimism
Crude oil prices fell sharply over the long weekend as investors grew more optimistic that the U.S. and Iran are moving closer to an agreement that could reopen the Strait of Hormuz and ease global supply disruptions. Brent Crude dropped about 7% to $96.14 per barrel, while West Texas Intermediate fell more than 6% to $90.30 after President Trump said negotiations with Iran were proceeding nicely. Markets also reacted to reports that Iranian and Qatari officials met to discuss a framework for ending the conflict and reopening the critical shipping lane, which historically handles roughly 20% of global oil supply. Despite the recent decline, oil prices remain significantly above pre-war levels as traders remain cautious that negotiations could still break down and reignite supply concerns.
As always, Base Wealth Management remains focused on aligning investment strategies with your long-term goals amid evolving market conditions.
