10 Things You Need to Know: March 25, 2025
Key data releases this week include: FHFA House Price Index (Tue), new home sales (Tue), consumer confidence (Tue), durable goods orders (Wed), Q4 GDP revision (Thu), pending home sales (Thu), personal income and spending (Fri), and PCE price index (Fri).
Haver
March 19, 2025
The Federal Open Market Committee left the target range for the Fed funds rate unchanged at January’s 4.25% to 4.50% level. Expected real GDP growth Q4/Q4 was lowered to 1.7%, 1.8% and 1.8% from 2.1%, 2.0% and 1.9% in 2025, 2026 and 2027, respectively. The unemployment rate projection for Q4 2025 was raised to 4.4% from 4.3%. Expected core PCE inflation for 2025 Q4/Q4 was raised to 2.8% from 2.5%, but 2026 & 2027 expectations were left at 2.2% & 2.0%.
Haver
March 20, 2025
Existing home sales increased 4.2% (-1.2% y/y) during February to 4.26 million (SAAR) units, according to the National Association of Realtors (NAR). The Action Economics Forecast Survey expected 3.96 million SAAR. The median price averaged by all existing homes (NSA) rose 1.3% (3.8% y/y) to $398,400 in February after a 2.6% January decline.
The Conference Board
March 20, 2025
The Conference Board Leading Economic Index (LEI) for the US declined by 0.3% in February 2025 to 101.1, after a 0.2% decline in January. Overall, the LEI fell by 1.0% in the six-month period ending February 2025, less than half of its rate of decline of –2.1% over the previous six months (February–August 2024).
Capital Economics
March 21, 2025
The euro-zone will get a boost from Germany’s decision to ditch its fiscal rules and ramp up defense spending. But governments other than Germany won’t loosen policy very much, and the region’s industrial sector will continue to suffer from poor competitiveness and weak global demand, with higher US tariffs acting as an additional headwind. So, we think economic growth will accelerate, but not dramatically, over the coming year or two.
Capital Economics
March 24, 2025
Our China Activity Proxy suggests that China’s economy slowed over January and February, driven by a sharp slowdown in services sector growth. Fiscal expenditure is set to pick up over the coming months, but that will largely be offset by the drag from US tariffs. As a result, we expect growth to slow to 4% this year.
Capital Economics
March 20, 2025
We think that vulnerabilities in some frontier markets and slow-burning fiscal problems in a handful of larger EMs merit close attention. But these aren’t symptomatic of widespread vulnerabilities in the emerging world. Indeed, our EM financial risk indicators suggest that balance sheets across most emerging economies are generally healthy.
Barron’s
March 24, 2025
The Fed is slowing the shrinkage of its balance sheet to redeeming $5 billion of Treasury securities a month from $25 billion previously. Reduced redemptions will mean the Fed will be reinvesting $160 billion more in the Treasury market from April to December. That will come in handy after foreign investors shed Treasury notes and bonds for the third straight month in February.
Robert Dietz, Chief Economist at the National Association of Home Builders, Barron’s
March 24, 2025
“Roughly 70% of building materials are imported, and of that total, more than 20% comes from China [and] a bit more than 20% comes from Canada and Mexico. It isn’t just lumber. It’s gypsum, dry wall. A third of appliances are imported. A large share of refrigerators is manufactured in Mexico.”
Oxford Economics
March 20, 2025
We expect the Fed to maintain the current policy for longer than officials currently anticipate, with the next rate cut not due until December.