10 Things You Need to Know: July 2, 2025
Key data releases this week include: ISM Manufacturing (Tue), JOLTS Jobs Openings (Tue), factory orders (Thu), ISM Services (Thu), trade balance (Thu), and nonfarm payrolls (Fri).
Haver
June 23, 2025
Existing home sales rose 0.8% (-0.7% y/y) in May to 4.03 million units after falling 0.5% in April. The Action Economics Forecast Survey expected a decline to 3.95 million units. Meanwhile, sales of new single-family homes declined 13.7% (-6.3% y/y) in May to 623,000 (SAAR). The Action Economics Forecast Survey expected sales of 693,000 during May.
Haver
June 24, 2025
U.S. house prices fell 0.4% m/m in April after holding steady in both March and February, according to the Federal Housing Finance Agency (FHFA) House Price Index. The year-on-year rate of increase decelerated to 3.0% in April, the lowest since May 2023.
Haver
June 26, 2025
The 0.2% q/q saar decline in Q1 real GDP was revised significantly weaker to a 0.5% decline. The Action Economics Forecast Survey looked for no revision. The major factor behind the downward revision was much weaker personal consumption expenditures (PCE) than previously estimated. The sharp widening of the trade deficit continued to be a major drag on GDP in Q1.
Haver
June 27, 2025
The PCE chain price index rose an expected 0.1% (2.3% y/y) during May, the same as in April. The price index excluding food & energy rose 0.2% (2.7% y/y), after two straight 0.1% increases.
Bloomberg, South China Morning Post
June 26, 2025, June 27, 2025
The US and China have finalized a trade understanding first outlined in Geneva, according to US Commerce Secretary Howard Lutnick. The deal includes a Chinese commitment to deliver rare earth materials, in exchange for the US lifting countermeasures, Lutnick said. The agreement is part of a broader White House effort to secure trade pacts with 10 major partners ahead of a July 9 deadline.
Bloomberg
June 26, 2025
Russia’s economy faces a worsening outlook that is graver than publicly acknowledged, with a credible risk of a systemic banking crisis in the next 12 months, according to Russian banking officials. Russian banks are increasingly concerned about the level of bad debt on their balance sheets. They have privately raised the alarm about the number of corporate and retail clients who are failing to make loan payments as they struggle with high interest rates.
Barron’s
June 30, 2025
EY-Parthenon Chief Economist Gregory Daco believes the impact of tariffs has been blunted by the front-loading of imports; use of bonded warehouses and foreign trade zones, which can delay tariff payments until goods enter the U.S.; temporary cost absorption by importers; lags in measuring tariff pass-throughs; and absorption of costs by exporters. A recent CFO survey found 41% planned to hike prices while 30% said they would absorb tariff cost increases in the next year.
Capital Economics
June 26, 2025
We expect tariffs to have only a modest impact on both real economic growth and price inflation. Admittedly, we do see annualized GDP growth slowing to around 1.5% in the second half of this year, but it should gradually recover from the second half of 2026 onwards. We expect core PCE inflation to end this year a little above 3% which, given the lingering threat of a more persistent pick up, will prevent the Fed from cutting interest rates until early next year.
Bloomberg
June 29, 2025
President Donald Trump stated he likely won’t extend the July 9 deadline for countries to finalize trade deals and avoid increased tariffs, despite having the flexibility to do so. This contrasts with Treasury Secretary Scott Bessent’s assessment, who suggested some agreements might not be ready by that date and indicated a Labor Day target for wrapping up most trade efforts.