Rising CPI reinforces Fed caution. Inflation showed early signs of tariff-related pressure in June, with headline CPI rising to 2.7 percent year over year and core CPI reaching 2.9 percent. The pickup in core goods prices suggests that cost pass-through is beginning to take hold in categories directly exposed to trade measures, such as appliances, consumer electronics, sporting goods and toys…

Narrow group of industries dominates June employment gains. Total U.S. employment rose by 147,000 jobs in June as the unemployment rate edged down to 4.1 percent. Private hiring was led by expansions in the education, healthcare, leisure and hospitality sectors, which accounted for over 90 percent of net non-government employment gains. Nearly all other private sectors posted minimal…

Clarity on Tax Policies Reduce Uncertainty and Reinforce Appeal of Real Estate Investment Codified tax breaks provide policy certainty. The newly passed “One Big Beautiful Bill” Act extends core elements of the 2017 Tax Cuts and Jobs Act while codifying several key tax provisions into permanent law, including 100 percent bonus depreciation, the Qualified Business Income deduction and Low-Income Housing Tax Credits. The legislation provides measured support rather than dramatic stimulus, yet reinforces real estate’s… Read More

Fed maintains wait-and-see approach. The Federal Open Market Committee opted to not adjust the overnight lending rate at its June meeting, marking six months at a 4.25 percent lower bound. This decision indicates that the FOMC has a favorable view of both the current state of the labor market and inflation. The U.S. unemployment rate has held under 4.5 percent — around the level of full employment — for almost four years, while the…

Tariff pass-through absent for now, but services remain sticky. May’s CPI report reflected a modest increase in prices. Headline inflation rose 0.1 percent month over month, bringing the annual rate to 2.4 percent. The data suggests price pressures from tariffs have yet to pass through to consumers; Core Goods CPI stayed flat in May and the year-over-year rate held at just 0.3 percent. Apparel and vehicle prices continued to…

Generally positive labor report carries caveats. Employers brought on 139,000 new personnel on net in May, marking the second-most active month for hiring this year, behind only April. This most recent job creation tally, however, trails the 2024 monthly average by about 29,000 positions. Last month’s greater headcount was also highly concentrated, with 90 percent of the net employment gain stemming from…

Potential Interest Rate Rise Prompts Investors to Recalibrate Strategies Deficit surge and policy uncertainty amplify upward rate trajectory. Interest rate risk remains tilted to the upside as investors contend with a convergence of structural and policy-driven pressures. Chief among them are rising fiscal deficits and elevated uncertainty surrounding U.S. trade policy. Combined, the factors increase the likelihood of higher long-term interest rates, as investors demand greater yields to compensate for fiscal and policy risk. Analysis of… Read More

Headline CPI inches up in April amid notable trade policy shifts. Changes to consumer prices in April indicate that tariff-related costs increases have yet to pass through to households. During the month, the consumer price index for all items rose 0.2 percent, bringing the annual inflation rate to 2.3 percent. Core CPI, meanwhile, remained unchanged at 2.8 percent year over year. Underlying price pressures were relatively stable during the…

Stretch of resiliency may be waning. While core retail sales rose 5.4 percent year-over-year in April, spending was unchanged on a monthly basis after adjusting for core CPI inflation — an indication that a pullback in consumer spending is materializing. Even so, several key retail categories registered encouraging gains during the month, including restaurants and bars. These increases, however, were offset by…

Hiring proceeds despite changing U.S. trade outlook. Exceeding expectations, total employment rose by 177,000 positions last month, keeping gains on par with the monthly average for the past year. The health care and social assistance sectors contributed the most to this growth. Meanwhile, the federal workforce declined by 9,000 roles, bringing total reductions to 26,000 since January. This figure may rise…