10 Things You Need to Know: June 3, 2025
Key data releases this week include: ISM Manufacturing (Mon), JOLTS Jobs Openings (Tue), factory orders (Tue), ISM Services (Wed), Beige Book (Wed), trade balance (Thu), consumer credit (Fri), and nonfarm payrolls (Fri).
Haver
May 27, 2025
U.S. house prices slipped 0.1% during March after holding steady in February, according to the FHFA House Price Index. The year-on-year increase decelerated to 3.7% in March, the lowest since June 2023, and remained well below the high of 18.7% in February 2022.
Haver
May 29, 2025
Real GDP slipped 0.2% SAAR (+2.1% y/y) during the first quarter of 2025, revised from down 0.3%, after increasing 2.4% in Q4’24 and 3.1% in Q3’24. A 0.4% decline had been expected in the Action Economics Forecast Survey. Foreign trade subtracted 4.90 percentage points from growth last quarter. Personal consumption expenditures rose 1.2% (2.9% y/y), revised from 1.8%.
Haver
May 30, 2025
Personal consumption expenditures (PCE) increased 0.2% (5.4% y/y) in April after a 0.7% rise in March. The gain matched expectations in the Action Economics Forecast Survey. Personal income rose 0.8% (5.5% y/y) after gaining 0.7% in March. A 0.3% gain was expected.
Haver
May 30, 2025
The PCE chain price index edged 0.1% higher in April (2.1% y/y) after holding steady in March. The price index excluding food & energy also rose 0.1% (2.5% y/y) for the second straight month.
Barron’s
June 2, 2025
Earnings for companies that have already reported are up 13% year over year. An impressive 78% of companies have beaten earnings expectations, he notes, and most companies have been expanding their margins despite anxiety that tariffs and consumer weakness would weigh on them. The biggest tech stocks have contributed about half of that earnings growth.
Barron’s
June 2, 2025
There is growing unease over the dominance of the top 10 stocks in the S&P 500, which carry a 36% weight in the index. But other markets have the same problem, only larger. The top 10 stocks in China, Brazil, France, Germany, and South Korea weigh in at 50% or more. The euro zone and Japan don’t lag by much, at about 28% for their leading names.
WSJ, CNBC, Reuters
May 26, 2025
Federal Reserve officials expressed concern that significant tariff hikes could exacerbate inflation and potentially lead to stagflation, creating challenges for interest rate policy, according to meeting minutes. Officials agreed to maintain a cautious policy stance and keep rates steady, noting that while economic growth remains solid, uncertainty about fiscal and trade policies has increased. The meeting took place before US and China eased some tariffs.
Oxford Economics
May 30, 2025
Consumer spending has been off to a solid start so far this year, rising by 0.5% in February and by 0.7% in March after a roughly flat reading in January. That could change as higher tariffs filter through the economy. We don’t think this shock will be enough to push the economy into a recession, but the degree to which consumers increase their precautionary savings may end up being the deciding factor as to whether a recession materializes.
Business Insider, Financial Times
June 2, 2025, June 1, 2025
Treasury Secretary Scott Bessent has expressed confidence that the US will not default as the deadline to raise the federal debt ceiling nears. Bessent says the US is “on the warning track” but will avoid hitting “the wall.” Republican leaders have linked the debt limit increase to President Donald Trump’s tax and spending bill, complicating negotiations. He declined to offer an “X date” when the Treasury runs out of cash.