Yesterday the Atlanta Fed forecast that Q1 GDP would come in negative 1.5%. This morning they revised that calculation to a negative 2.8%. Great news for interest rates; bad news for economic development.
The new tariffs starting today will most likely hamper growth; and the impact is more psychological than fiscal. The monthly cost of tariffs to the average American household is calculated to be only around $100 per month. And that’s a lot of money for a lot of people.
OPEC unwinding their production cuts implemented in 2022 and again ramping up production has brought the price of a barrel of crude down to $67. Lower fuel costs will assist inflation to decline and help Americans recoup some of the tariff expenses.
Technically, MBS have risen sharply (giving us lower interest rates) over the last three weeks and now are up against a strong ceiling of resistance which batted then down 200bps December. I’m locking in loans today at the best rates in the last two months.
