For all the fantastic amounts of noise that’s erupted from the Trump Administration’s tariffs proposals last week, the world still goes on.
You can read about the tariffs just about anywhere.
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You can listen to and watch coverage of the event that sent the stock market into its worst weekly decline since 2020: a big-time tailspin, no matter how one spins it.
One does not ignore the slashing of $6 trillion of investors wealth in two days.
In fact, futures trading late Sunday shows no one is ignoring last week. Trading suggests another rough open for stocks is coming on Monday as the new 10% baseline tariff rate went into effect over the weekend.
Crude oil was falling, and bitcoin dropped nearly to $78,000, the lowest price since November.
This week, new snapshots of the U.S. economy will muscle their way into view, and they are worth paying attention to.
Here’s a look at what to expect.
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Inflation: Not going away
Two important inflation reports are due out.
Consumer Price Index for March due Thursday morning. The report comes from the U.S. Bureau of Labor Statistics. The consensus estimate is for a 0.2% month-to-month gain or 2.8% gain year over year. Core CPI, which measures inflation with food and energy prices stripped out is expected to produce the same results.
This is the headline-grabbing report that much of official Washington watches very carefully.
What it means: The Federal Reserve doesn’t want to cut interest rates until inflation is closer to 2%. So, if the CPI report comes in at consensus, the Fed probably will not cut rates at its May 6-7 meeting. Minutes from the Fed’s March 18-19 meeting will be released at 2 p.m. ET Wednesday and will offer some details of their rate decision discussion.
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A more dour outlook on this comes from Yardeni Research, which sees goods prices continuing to put upward pressure on overall inflation and strengthening the Fed’s reluctance to cut rates.
What to watch: Not just goods prices or food prices both at home or out of the home. A key element in the CPI calculation is how it measures housing costs. The operative phrase is owners-equivalent rent. This is a measure of what a homeowner would have to pay in rent for a home similar to what the owner has now.
Producer Price Index for March, due Friday morning. This report, also from the BLS, measures the average change over time in the prices that domestic producers receive for their output.
This is, essentially, a track of inflation at the wholesale level.
The consensus estimate is for no change overall for March over February but a 3.2% gain year over year. Core PPI, which strips out food and energy costs, is expected to rise 0.2% month-to-month but 3.3% year over year.
What to watch. Price changes for services. This is another difficult-to-measure area. The overall services portion of the index includes transportation services such as Uber and Lyft fees, and airline, bus, and subway fares. But it does not account for sudden changes in energy prices, the Cato Institute notes.The PPI report does not include sales taxes because they don’t directly affect producers. (The CPI does include sales taxes in its calculations.)
Traders on the floor of the New York Stock Exchange (NYSE) on April 3.
CHARLY TRIBALLEAU/Getty Images
Consumer sentiment: How consumers looking at the economy
This report is issued twice a month by the University of Michigan’s Consumer Research Center. Due Friday.
This first report is based on responses from 420 consumers nationally. The second updates the first with responses now from around 800 consumers.
The overall sentiment was off more than 12% in March and had fallen for three straight months.
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The biggest worry in the March report was the potential for economic pain amid ongoing policy developments — inflation, federal government jobs and the like. Notably, two-thirds of consumers expected unemployment to rise in the next 12 months, the highest reading since 2009.
The Bureau of Labor Statistics’ unemployment report for March suggested the economy added 228,000 jobs in March, more than expected, and the unemployment rate had risen to 4.2% from 4.1%. (A note: The surveys required to produce the report are usually done in early-to-mid-month.)
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The Michigan March report did not mention tariffs. It’s probable it will be an issue in the April report.
The report is similar to the Consumer Confidence Index report, issued by the Conference Board. The business organization has likewise noted declining confidence among consumers. Its next report is due April 29.
One other report of note:
NFIB Business Optimism Index for March. Due at 6 a.m. ET on Tuesday. A reading above 100 The February report showed decreasing optimism, with only 37% expecting better business conditions. The biggest problem small businesses cited: getting qualified workers.
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