The economic boom is here
Economic Review: Job gains fall short in April, but economic growth remains strong (Page 3)
Economic growth spiked in the first quarter and recent data suggest that it surged even more quickly in the second. Although consumer spending should slow from March’s near-record jump, which was boosted by another round of stimulus checks, rising consumer confidence and the highest pace for vehicle sales since 2005 suggest that the propensity of consumers to spend is still high. On the downside, April’s employment report was disappointing, and the unemployment rate rose for the first time in a year.
Financial Markets Review: Earnings roar (Page 4)
The S&P 500 Index added more than five percent in April as first-quarter earnings were strong. But as this report was being written, stock indices stumbled, led by sharp declines in tech stocks. Commodities also participated in the April rally, with producers unable to quickly increase production to meet the surge in orders. After yields rose in the first quarter, interest rates were relatively stable over the past month.
The Outlook: Inflation set for a COVID-driven spike (Page 5)
The COVID pandemic may be finally winding down in the U.S., but its impact on the economy is likely to linger for some time. Consumer price inflation, for example, is already being lifted by several virus-driven effects. But while the inflation rate is now spiking, a lasting rise in price pressures still appears unlikely.
Go deeper with the full May report linked below.