A fresh batch of economic data signals a more fragile U.S. outlook, with slowing growth, resurging inflation, and tightening financial conditions converging as a new Fed Chair steps into the spotlight.
- The GDP from 1st quarter was revised down by about 40 basis points, driven by weaker-than-expected investment and consumer spending.
- Despite the downgrade, overall growth still improved from the near-stall seen at the end of last year.
- Personal Consumption Expenditures rose to its highest level in three years, marking a significant acceleration in price pressures.
- Personal income was essentially flat in April while consumer spending continued to increase.
- The personal saving rate fell to its lowest level in years as households drew down savings to sustain spending.
- Financial markets have fully priced out interest rate cuts for 2026 following the latest economic data.
- Initial jobless claims increased modestly but remain within a historically healthy range, signaling a stable but not robust labor market.
- Pending home sales rose for a third consecutive month, indicating continued buyer demand despite affordability pressures.
- Mortgage applications posted their sharpest weekly decline in nearly two months as 30‑year mortgage rates reached their highest level since last summer, with refinance activity dropping sharply.
- Housing data showed a shift toward rental development, with single-family starts declining while multifamily construction surged, and home prices falling in real terms for the 10th straight month across many major metros.
For more information on the state of the U.S. Economy, including forecasts, watch all the episodes of the Economy Express series.
