The US economy is showing signs of resilience, according to the latest economic data. Despite a period of rate hikes, consumer spending, adjusted for inflation, surpassed expectations after wages saw a significant increase. This positive news is leading strategists to believe that central bankers can afford to wait before making any decisions to reduce benchmark interest rates.
Fed Chair Jerome Powell emphasized the need to not rush into rate cuts during a recent speech. Despite underlying inflation cooling in February, Powell remains confident in the strength of the US economy, citing solid growth and a strong labor market as reasons to exercise caution.
Despite concerns about a potential tech bubble fueled by artificial intelligence, traders are continuing to push stocks higher. The S&P 500 hit a record high this week, closing out a quarter with a market surge of over 10%. Analysts like Chris Zaccarelli at Independent Advisor Alliance are impressed with the resilience of the economy and consumer confidence, leading investors to focus on positive economic indicators rather than concerns about delayed Fed rate cuts.
