Update Explanation regarding Data Release Summary of Economic Projections March 19, 2025
GDP and Unemployment are projected to decline. This indicates that the US economy is experiencing a slowdown.
On one hand, Inflation is projected to increase further in 2025 due to the effects of tariff wars from Donald Trump. All industries will experience price increases due to the tariffs imposed by Donald Trump.
In fact, this is quite bad for risk assets; the current market increase is due to Jerome Powell (The FED) mentioning the end of QT (Quantitative Tightening), so the market still concludes that this remains Bullish. (Not sustainable due to uncertainty in the US economy).
Quotes from The FED that have caused the market to react bullishly at this time:
š Fed says it will slow the pace of balance sheet drawdown next month
š Fed shift comes amid less clarity over money market conditions
š No sign yet Fed ready to end quantitative tightening