Succinct Summation of the Shortened Week's Events

Succinct Summation of the Shortened Week’s Events:

Positives,

1)Initial claims for the week ended 4/12 fell to 215k from 224k and that was 10k less than expected. The 4 week average moves to 221k from 223k. Continuing claims totaled 1.885mm, up from 1.844mm but still hovering around November 2021 levels.

2)Core retail sales in March rose .4% m/o/m, two tenths below expectations but offset by a three tenths upward revision to February to a gain of 1.3%. Clear evidence of a buying rush ahead of tariffs was apparent as auto/parts sales jumped by 5.3% after two months of declines. Building material sales were higher by 3.3% m/o/m.

3)In what is now very old news, both because of the onslaught of tariffs and also the weaker US dollar, March import prices were benign, falling one tenth m/o/m headline, unchanged ex petroleum and up one tenth ex food and energy fuels.

4)Likely helped by tariff pull forward, US manufacturing production in March was a touch above the estimate.

5)From Bank of America: "going more to what our customer data shows, it shows that the money moving across all our consumer spending methods, debit and credit cards, ACH, checks written, Zelle, etc... All that aggregate shows it grew at about a 4.4% pace in the first quarter of 2025 compared to the first quarter of 2024...you can note that consumer spending has been consistently growing y/o/y, but during last year, it actually slowed a bit, especially in the summer and picked back up in the fall. That resulted in the 4^th quarter of '24 over the 4^th quarter of '23 being about a 4% pace and that pace has continue.” And, "That pace has also continued through the first part of April. We note that some retailers may say that their sales are slower and others are picking up, and it really reflects the change in consumer spending behavior. But in the aggregate, the consumer keeps pushing money into the economy." Assume some of this is front loading of purchases. “As we look at our business side and what our business clients are telling you, in the current setting, they remain profitable, liquid and have strong results. They all look ahead and worry about the same things that you hear reflected in your conversations with them also. So, we continue to watch for signs of the environment actually changing."

6)From JP Morgan: "Consumers and small businesses remain financially healthy. Despite the recent downtrends in consumer and small business sentiment based on our data, spend, cash buffers, payment-to-income ratios and credit utilization are all in line with our expectations."