The Atlanta Federal Reserve’s GDPNow forecast turned negative at -2.8% earlier this week, raising concerns about potential stagflation in the U.S. economy, according to QCP Capital.
Market Focus on Key Economic Indicators
Non-Farm Payrolls (NFP) Report: Scheduled for release this Friday, the NFP data will provide insights into the labor market's strength and its potential impact on Federal Reserve policy.
Consumer Price Index (CPI) Report: Set for next Wednesday, this inflation data will be closely monitored to assess whether inflationary pressures persist, influencing future interest rate decisions.
Economic Implications
The negative GDP forecast suggests a slowdown in economic activity, which, combined with high inflation concerns, raises the specter of stagflation—a scenario of slowing growth alongside persistent inflation. Market participants are now looking to the upcoming macroeconomic releases for further direction, particularly in relation to Federal Reserve policy expectations and risk asset performance.