The US Economy's Resilience Is Now Undeniable
Reasonable people can disagree about whether US disinflation is actually stalling and what it might mean for Federal Reserve monetary policy. But it’s getting much harder to deny the underlying strength of the economy, suggesting central bankers can afford to wait before reducing benchmark interest rates.
New data Friday from the Bureau of Economic Analysis showed that even after adjusting for inflation, personal spending climbed 0.4% in February, comfortably exceeding the median estimate of economists surveyed by Bloomberg for a 0.1% increase. A day earlier, separate reports showed that consumer sentiment increased to the highest since July 2021, weekly initial jobless claims fell and pending home sales bounced back in February from a decline in January. In an economy that has consistently outperformed and is constantly being scoured for cracks, it’s hard to find any faults in the latest data.