Principal Knowledge Center
The latest insights from our experts on attitudes, behaviors and trends that impact long-term financial security. Thought leaders from across the globe provide data analysis, research and perspective on the economy, investment management, retirement security and more.
The world economic expansion that began in early 2016 marched onward in the first quarter, but growth momentum came off the boil. Outside the United States, the energy that kept pushing signs of business activity and consumer confidence to new cycle highs for over a year has faded.
After new Fed Chairman Powell’s flawless press conference, investors aren’t much closer to an answer. Some analysts felt the changes in Federal Open Market Committee (Committee) members’ expectations leaned toward a fourth rate hike in 2018.
For 2018, the market has already priced in three rate hikes, and some investment firms are calling for four. If the Fed tightens too quickly that would be negative for markets and for the U.S. economy.
Markets are concerned about the 10% aluminum and 25% steel tariffs just announced by the Trump administration. The direct impact of the tariffs themselves is not as big of a deal as any secondary effects.
A bit of deceleration. When things are so good they can’t get any better, they usually don’t. Still, the robust momentum should carry well into 2019.
Remember all that talk of deflation, or declining prices? Weak demand and excess supply forced inflation down, down, down in the years after the global financial crisis. The United States never experienced outright deflation, but disinflation, or decelerating inflation, was present throughout much of the post-financial crisis era.