Goods Economy Still On The Ropes

A growth recession is still rolling through the goods sector. Real consumer spending on goods has been flat at a record high since early 2022. We expect that spending on services, technology, and onshoring will keep the economy growing. There's still no stagflation or recession in our forecast.

Today's M-PMI report was weaker-than-expected. That followed Friday's weaker-than-expected personal income report with spending on goods down more than it increased on services. In the fixed income market, 2-year and 10-year yields declined as more Federal Reserve rate cuts are back on the table. The US dollar also fell to a three-week low. Stocks have been on a rollercoaster ride of late and may continue to do so through the summer. Let's review the latest data: