Hey Friends! this week is jam-packed with stuff that could shake up the economy and markets, so buckle up and let's dive in!

First up, on Tuesday, we've got the April PPI Inflation data dropping. This is like a sneak peek into what might be happening with prices down the line, especially for us consumers. Looks like core producer inflation is inching up, expected to hit 2.2% year over year.

Then, same day, we're all ears for what Fed Chair Jerome Powell has to say. His words could give us a hint about where the Fed's heading with money stuff, which is a big deal for investors and businesses trying to plan ahead.

Wednesday rolls in with more data bombs. April CPI Inflation data is hitting the scene, giving us the lowdown on how prices are treating us regular folks. And man, CPI has been flexing lately, making mortgage rates jump as bond prices take a hit. Plus, we'll get updates on retail sales and mortgage applications, so keep those peepers peeled.

Thursday wraps things up with the Philadelphia Fed Manufacturing data. This gives us a snapshot of how things are chugging along in the manufacturing world, giving us a heads up on what's happening in the broader sector.

Oh, and don't forget about the Federal Reserve officials gabbing throughout the week. They'll be dropping some knowledge bombs about what they think is going on with the economy and what they might do about it.

Now, everyone's itching to know when the Fed's gonna cut rates, even if it means risking a bit of inflation. Personally, it's more realistic for us to figure out ways to boost our earnings than to expect mortgage rates to magically drop to 3% or home prices to plummet by 40%.

According to some CEOs in the April Conference Board CEO Confidence survey, they're betting on just one rate cut this year from the Fed. But the market's playing a slightly different game - pricing in two cuts for the year, with the first potentially hitting us in September. This highlights the uncertainty surrounding the Fed's future actions, with market sentiments changing frequently in recent months, initially expecting six rate cuts, then dropping to one, and now back up to two. The fluctuating expectations create a sense of unpredictability, emphasizing the ongoing challenges for businesses in navigating economic conditions and planning for the future

Market Expectations for the Fed Funds Rate:

• June 12, 2024: Expected to stay the same.

• July 31, 2024: Expected to stay the same.

• Sep 18, 2024: Expected to cut by 0.25% to a range of 5.00-5.25%.

• Nov 7, 2024: Expected to stay the same.

• Dec 18, 2024: Expected to cut by 0.25% to a range of 4.75-5.00%.

• Jan 25, 2025: Expected to stay the same.

• Mar 19, 2025: Expected to cut by 0.25% to a range of 4.50-4.75%.

• Apr 30, 2025: Expected to stay the same.

And speaking of jobs, things seem to be cooling down in the US labor market. Unemployment's on the rise, and job growth is slowing, which means fewer companies are looking to hire. Plus, fewer job openings and sluggish wage growth suggest that inflation pressures might be shifting gears. When people aren't earning as much, they're not spending as much, which could ease concerns about inflation heating up too much.

But hey, let's talk about housing. The cost of owning a home has been skyrocketing over the last few years, making it feel like a luxury for many. Rent prices are climbing too, leaving lots of folks with no choice but to keep on renting. And while homeowners are crossing their fingers for their property values to keep soaring, renters are left feeling the squeeze.

Home prices? They're still climbing. CoreLogic's Home Price Index is on the rise, and it's not showing any signs of slowing down. But don't get too comfortable; consumer sentiment is taking a hit, with folks feeling less confident about the economy and their own wallets. If spending slows down, it could mean rough waters ahead for the economy.

So, keep your eyes peeled for all the latest data drops. Things can change in the blink of an eye, so it's crucial to have a solid plan in place and stick to it.

The recent dip in US consumer sentiment, hitting its lowest point since November 2023, is really speaking volumes about how worried folks are getting about our economy and personal finances. It's not just the big reports; even in everyday conversations, you can feel the unease creeping in.

In just a month, the consumer sentiment index took a nosedive, dropping from 77.2 in April to a dismal 67.4 in May, way below what anyone expected. And it's not just one thing; expectations across the board are sinking – from personal finances to business outlooks and even how confident people are about buying stuff. Everything's hit a six-month low. People are gearing up for inflation to jump to 3.5%, the highest it's been since November 2023, and that's got everyone worried about how much their money can buy.

And if that wasn't enough, a recent report from the San Francisco Fed painted a pretty bleak picture. It turns out, households have pretty much drained whatever savings they squirreled away during the pandemic by March 2024. On top of that, credit card debt has shot up to record highs, peaking in the last quarter of last year. And while those Buy Now Pay Later deals are all the rage, it's not all sunshine and rainbows. More and more people are struggling to keep up with payments, showing signs of getting in over their heads with spending.

With consumer spending being such a big chunk of our GDP – around 70% – any slowdown could send ripples through the whole economy, possibly easing off on inflation rates and bringing down interest rates. It might take a bit for these changes to really kick in, but keeping a close eye on how spending trends shift will be key in figuring out where our economy's headed.

And down there, next to a headline from January 23, 2024, it's like a reminder of how fast things can change. Back then, everyone was buzzing about a rate cut in March, with market expectations through the roof. But now, on May 13, 2024, consumer confidence is taking a hit as inflation sticks around and interest rates stay high. It just goes to show, things can flip on a dime. That's why having a solid plan and sticking to it is so important.