Here is what happened in the Capital Markets this week.
The Weekly Bottom Line (please click link to open)
The Weekly Bottom Line, courtesy of TD Economics, includes a review of market performances, recent key economic indicators, a calendar of upcoming key economic releases, and other relevant data. The highlights from this week’s report include:
· Apart from vehicle sales, recent data paint a positive narrative for consumer-related industries at the start of spring. Real consumer spending and pending home sales surged in March, while consumer confidence improved in April.
· Payrolls were up 263k in April, much better than expected; wage growth held steady at 3.2% y/y and the unemployment rate fell to a near-50 year low of 3.6%. A drop in the labor force participation rate assisted the latter.
· The Fed held rates steady this week, with an emphasis put on inflation running below target. But in the press conference, Fed Chair Powell noted that inflation was driven down by “transient” factors, adding that there is no strong case “for moving in either direction”. Indeed, for now, all of the tea leaves suggest that the Fed will remain on hold for some time.