Take a look at what happened last month and what’s ahead in the market and economic environment. Check out the latest Month in Review.
While markets reversed their downward trend for the month, inflation did not reverse its grind higher with CPI hitting the highest level in more than 40 years. As the inflation keeps climbing and the Fed has raised rates to combat this, labor markets have begun to show signs of loosening with jobless claims ebbing up. Check out the latest Month in Review.
With inflation at multi-decade highs and inflation expectations inching up, the Fed has reprioritized its focus from supporting growth to quickly taming inflation. The Fed has stated (unequivocally, to our ears) that they would gladly risk a recession now via restrictive policy to avoid the bigger risk of higher and more entrenched inflation later. This is the right long-term policy, but means that economic growth will slow in the near term.
With the Fed attempting to reign in overheating inflation via increasing interest rates, consumers begin to feel the pressure of the tightening financial conditions. The University of Michigan’s Consumer Sentiment Survey reached its lowest level in history. Check out the latest Month in Review.
As the month went on, the volatility continued, but risk assets went on a final run towards the end of the month with almost all asset classes ending in the green for May. Check out the latest Month in Review.
From asset class performance to the Fed’s monetary policy in the midst of peak inflation, Prime Capital Investment Advisors’ Research Team has done the deep dive to bring you the information you need to know now. Check out the April Month in Review.
Domestic and International Developed equities posted a month in the green but remain in the red for the year thus far. Bonds and Emerging Markets continued their year-to-date rut.
Risk Assets continued to dig themselves out of their year-to-date hole, with most global indices posting a positive, or very slight negative week.
Overall, economic data releases mostly met their expectations, showing that despite the near-term effects of the Russia-Ukraine conflict, the economy is still marching on. Importantly, the FOMC raised interest rates for the first time and took on a very hawkish tone for future monetary policy. Next week is on the lighter side, most releases relate to manufacturing data and real estate.
European equities were able to recover some losses for the week, but the rest of global equities were largely in the red as the conflict between Russia and Ukraine raged on.