📉 Gross Domestic Product (GDP)
GDP in Q1 2025: down 0.3% year-over-year, marking the first decline since early 2022. The primary reason is a record trade deficit and weaker-than-expected consumer spending.
Final sales to domestic consumers: up 3%, indicating that underlying demand remains stable.
👷 Employment and labor market
April 2025 jobs report: added 177,000 jobs, exceeding the forecast of 125,000, indicating that the labor market remains strong.
ADP jobs report: only 62,000 jobs were created in the private sector, much lower than expectations.
Unemployment rate: remains at 4%, indicating that the labor market remains stable.
💸 Inflation and consumer spending
Core PCE inflation for March 2025: unchanged, with an annual rate of 2.6%. However, inflation in Q1 2025 reached 3.5%, higher than the Federal Reserve's target.
Personal consumption expenditures: up 1.8%, with spending on durable goods down 3.4%.
📦 Trade and investment
Trade deficit for March 2025: hit $162 billion, an increase of $14.1 billion from the previous month, due to a surge in imports ahead of the new tariffs from President Trump.
Fixed investment: up 7.8%, possibly due to businesses ramping up investment before the new tax rates are implemented.
🏭 Production and consumer confidence
ISM manufacturing index for April 2025: reached 48.7%, a slight increase from 47.8% in the previous month, but still below the 50% threshold, indicating continued contraction in manufacturing activity.
Consumer confidence: remains stable, reflecting positive consumer expectations about the economy.
💹 Financial markets and monetary policy
Policy interest rate: The Federal Reserve holds steady at 4.5%, but the market expects a possible rate cut by mid-year if inflation continues to cool and growth slows.
Stock market: shows signs of recovery due to expectations that China will respond to U.S. tariff proposals, although profits from energy and technology companies are under pressure.
