Last Week: -0.12%
YTD: 11.74%
1 Year: 27.89%
Dow Jones Industrial Average
Last Week: –1.87%
YTD: 4.34%
1 Year: 20.28%
Last Week: 0.62%
YTD: 12.74%
1 Year: 31.84%
Last Week: –1.49%
YTD: 2.61%
1 Year: 18.24%
YTD: 14.41%
1 Year: 34.68%
YTD: 7.42%
1 Year: 20.67%
U.K. Inflation
Inflation results from the U.K. last week came in hotter than expected despite dropping to 2.3%. Economists had been expecting a drop to 2.1% to bring them within striking distance of the 2% target inflation rate. The largest factor was only the small decline in service inflation in the U..K. which declined from 6% to 5.9% from a year ago. With the inflation miss from the month, this could jeopardize the expected rate cut by the British Central Bank this coming month.
U.S. Economy Too Strong?
The recent data showing a steadily growing U.S. economy gives little indication the Fed will cut rates over the summer months. Stubborn inflation and household spending give the Fed little reason to cut rates. The Fed is going to continue navigating inflation in hopes of a “soft-landing”. The good news is with interest rates being higher now than before, the Fed has some power to deploy if a recession is looming. They can cut rates and increase the money in circulation by enticing better loan rates for borrowers in the future. The minor uptick in unemployment has not yet reached 4%. This data point and household spending could cause the Fed trouble as they look to prevent stagflation.
Home Sales Drop
Inventory in April rose 9% month to month and up 16% from a year ago. Despite the increase in the supply of homes hitting the market, home sales slipped unexpectedly in April. First-time home buyers did see an increase in sales making up 33% of April home sales, up from 29% a year ago. The median price of existing homes sold in April was $407,600, an increase of 5.7% from this time last year. As more houses hit the market and inventory continues to rise, this should drive home prices down.
