08 Feb GDP, PCE, AND JOBS

U.S. stocks and bonds were hit by inflation concerns over the past week,
but what is the economic data telling us? A barrage of U.S. economic data was
released over the past two weeks, including major reports such as fourth quarter
gross domestic product (GDP), personal consumption expenditure (PCE) inflation,
and the January employment situation report. We will discuss the impact of each
individual report in more detail later, but overall the data deluge has signaled
that the U.S. economy remains on stable footing. Signs of rising inflation were
present in all three reports, which is one of the factors behind both stock and bond
weakness over the past week. However, we would remind investors that, for now
at least, inflation readings remain below the Federal Reserve’s (Fed) 2.0% target,
and we would need to see continued acceleration before we would expect a more
aggressive path of Fed rate hikes.

View the full weekly market commentary here.

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