Macro Report

Week’s Takeaway:

Housing data came in softer this week while industrial/manufacturing data show a continued recovery. A stable labor market and a strong consumer continued to push back the markets expectations for when the first cut will occur.


Housing starts and building permits were both down 14.7%, and 4.3%, respectively in March, which was below expectations of down 2.4%, and 0.9%. This comes after 2 months of impressive growth to start the year. Additionally, March’s existing homes sales were down 0.3% compared to the expectation of a 0.1% decline. Existing sales were likely a reaction to the fact that mortgage rates started increasing in March and are currently back up to early December levels. Finally, the NAHB (National Association of Homebuilders) housing market index remained stable at 51 in March, in line with expectations.

March’s Industrial production index came in line with expectations, printing up 0.4% compared to February. Looking more closely at the underlying manufacturing production component was even more impressive. Here, production rose 0.5%, beating expectations of up 0.2% and February data was also revised higher, to 1.1%, up from the initial read of 0.8%. FED Manufacturing surveys started to come out for April as well, with both Empire (NY) and Philly increasing from last months readings, up to -14.3 from -20.3, and 15.5 from 3.2, respectively.

Next Week’s Notes:

Next week’s economic calendar is filled with key updates. To start off, we will receive fresh insights into the manufacturing sector, with the preliminary S&P Global US Manufacturing PMI for April, which is anticipated to slightly dip to 51.8 from March’s 51.9, suggesting a relatively stable manufacturing environment. Additionally, the spotlight will also be on the two more April Fed Manufacturing Surveys set to be released, the Richmond and Kansas City indexes, as the first two showed cautious optimism. Furthermore, the preliminary March figures for Durable Goods Orders are expected to show a robust increase, jumping to 2.8% from February’s 1.3%, while Durables Ex Transportation is projected to hold steady at 0.3%, both forecasts indicating growth and stability.

We will also be provided with further insights into the housing sector, with March’s New Home Sales anticipated to show an increase, rising from 662k to 670k, and March’s figures for Pending Home Sales NSA YoY.

Finally, a batch of macroeconomic data that will shed light on the broader economic landscape is to be released. Notably, the GDP Annualized QoQ rate for the first quarter has market expectations for a slowdown, dropping to 2.3% from 3.4%, signaling potential shifts in economic momentum. On the inflation front, attention will focus on the March figures for the PCE Deflator YoY and the PCE Core Deflator YoY as they will be pivotal in assessing ongoing inflation trends and their implications for monetary policy. The former is projected to edge up to 2.6% from 2.5%, while the former is anticipated to dip to 2.7% from 2.8%. Additionally, the final report from the University of Michigan April consumer surveys will be issued, providing an updated gauge on consumer sentiment.