Key economic data came out this week through the form of the April CPI data. This data is very important in its influence over the upcoming FOMC meetings. The CPI data for April came to 4.9%. This is slightly lower than expected (5%). Core CPI, which discounts home and energy data, came out to be 5.5%. This also came largely in line with expectations being at 5.6%. This data is largely in line with expectations as a whole and is a good sign, indicating the Feds’ interest rate hikes have been working. It is important to digest this information with other data like employment data, PPI, housing numbers, etc. to get a better understanding of the overall economy.
Debt Ceiling Debacle
The US Treasury is about to hit the debt ceiling, which refers to the limit to which the US can borrow money and pay it off. Estimates from the Treasury Department say that the “x-date” (the day the limit is reached) could be around mid-July to early August. However, newer reports mention a possibility of it arriving in early June. This puts immense pressure on Congress and the President to come to an agreement. Current issues arise where House Republicans, led by Kevin McCarthy, agree for a raise but want spending cuts along with it. The next few weeks are crucial to get a solution set in place, which both parties agree with.