Summary
United States: Economic Growth Holding On, for Now
- Real GDP growth is slowing but still holding on before an expected drag from tariffs kicks in. In March, retail sales rose solidly. Total industrial production fell during the month; however, manufacturing output gained. Housing starts pulled back sharply, though building permits increased.
- Next week: New Home Sales (Wed.), Existing Home Sales (Thu.), Durable Goods (Thu.)
International: Foreign Central Bank Policy Decisions Come Amid Heightened Uncertainty
- This week saw a couple of significant announcements from G10 central banks. The European Central Bank lowered its Deposit Rate by 25 bps to 2.25%, and in our view, the accompanying statement leaned slightly dovish overall. The Bank of Canada held its policy rate steady at 2.75% and offered limited future guidance on policy. Elsewhere, data from China showed the economy enjoyed a reasonably solid start to the year, but recently-racheted-up U.S. tariffs on China suggest this momentum may not be sustainable.
- Next week: Japan CPI (Fri.), Eurozone PMIs (Wed.)
Credit Market Insights: Household Debt Coming into Focus
- Recently released data from the Federal Reserve Bank of New York’s Household Debt and Credit Report provides some clarity on where households ended last year. While nominal debt has continued to edge higher, the rate at which households are borrowing has continued to taper.
Topic of the Week: Tariff Hikes to Exert Pressure on Construction Costs
- Another week, another tariff story. Broad-based tariffs stand to pressure the construction industry, where still-elevated input costs and interest rates have crimped activity.
