A basket of US economic data released on Thursday (April 18th), had reinforced analysts’ optimism over its underlying strength, as US retail sales had increased by the most in one and a half years in March, while US initial jobless claims fell to a nearly-50 year low.
Followed by the release of the data, nerve-wracking worries of an imminent recession risk and abrupt slowdown had temporarily been averted and investors’ optimism had been helping Wall St. indexes likes of S&P 500 hanging around closer to their multi-month highs.
More or less, concerns had been dissipated over the recent past in the wake of a bunch fairly upbeat data including a contraction of trade deficit, surge of inventories and construction spending, all of which had been struggling to display a decent growth during the last quarter of 2018.
Since, during the latest FOMC minutes, most of the Fed policymakers had been quoted saying that they would be deciding on whether to cut interest rate or to keep it at the same stance depending on the economic data, a flurry of upbeat data throughout April might have just circumvented an interest rate cut to 2.25 percent from current 2.50 percent at May’s Federal Reserve meeting.
Besides, a report from Federal Reserve on last Wednesday (April 17th) had said that the Fed had been deciphering economic activities expanding at a slight-to-moderate pace in March and early April. Citing to US economy’s underlying strength, a head of US macro investor services at Oxford Economics in New York, Kathy Bostjancic said, “The rebound in retail sales underscores that the domestic outlook remains favorable and well-supported by the labor market, and it dispels the misguided concerns that the U.S. economy is slipping into recession”.