GOOD - Tariffs Up, Inflation Down
2025-05-18 09:00:00 ET
Summary
- US equity markets surged this week - extending a dramatic post "Liberation Day" rebound - after the White House announced a trade truce with China, while investors cheered surprisingly cool inflation data.
- Quelling one of the primary recession risks, the U.S. and China reached a surprising breakthrough in agreeing to slash tariffs to pre-retaliation levels during a 90-day negotiating period.
- More good news on the inflation front. Despite the broad-based tariff hikes in April, the critical CPI and the PPI both showed the lowest annual increase in inflation since 2021.
- Extending its six-week rebound to over 15%, the S&P 500 surged 5.3% - closing within 3% of its all-time record high. REITs lagged, however, as interest rates breached three-month highs.
- While the "hard" data delivered encouraging trends this week, survey data continued to paint a significantly bleaker picture of the economic outlook. The University of Michigan's Consumer Sentiment Index dipped to its second-lowest level on record in early May.
Real Estate Weekly Outlook
US equity markets surged this week - extending a dramatic post "Liberation Day" rebound - after the White House announced a trade truce with China, while investors cheered a surprisingly encouraging slate of inflation data showing a continued broad-based cooldown in price pressures despite sweeping tariffs. Quelling one of the primary recession risks and prompting a positive re-think of economic growth expectations for the balance of 2025, the U.S. and China reached a surprising breakthrough in agreeing to slash tariffs to pre-retaliation levels during a 90-day negotiating period, continuing an encouraging pace of White House dealmaking over the past six weeks that has lifted equity markets back within striking distance of all-time record highs....
Tariffs Up, Inflation Down