Economic data is showing signs of decline after an artificial bounce attributed to tariff front-running. Previously, companies imported extensively before tariffs took effect, which temporarily boosted economic indicators despite a negative GDP print due to plummeting net exports. However, this initial surge is now reversing as imports dwindle following the implementation of tariffs, indicating that the overall economic situation is starting to deteriorate. Key labor indicators are rising despite stable unemployment rates, suggesting potential issues ahead. Additionally, the housing market, which had remained stagnant for a year, is also showing signs of weakening. The Federal Open Market Committee (FOMC) aims to delay any interest rate cuts, which could exacerbate these economic risks.

Source 🔗