US Economy Is Still Resilient, But Tariffs Pose Risks

Today's batch of economic data releases was positive on balance but also suggests that Trump Tariff Turmoil 2.0 could dampen future growth. Stock prices seesawed between gains and losses, while Treasury yields slid a bit. Markets continue to suggest that economic growth outside of the US is increasingly likely to improve while downside risks to US growth are rising. As a result, US stock valuation multiples are falling closer to their international counterparts (charts).

The same can be said about the spread between US government bond yields and foreign ones (chart).