Key economic data came out last week in the form of Thursday’s Philly Fed manufacturing index. The results were better than expected and pointed toward a soft landing. Unlike the fear-inducing April headline reading of -31.3, the month of May came in with a much better 10.4. For perspective, a reading below 0 represents contraction, while above 0 indicates factor-sector growth. It is important to digest this information with other data like employment data, PPI, housing numbers, etc. to understand the state of the overall economy better.
Debt Ceiling Negotiations Continue in Washington
For the past few weeks, concerns over the US debt situation have heightened. Negotiators are unable to come to a conclusion amid a short deadline, as the Treasury Department states the US may be unable to pay its bills and service its debt as early as June 1st if a decision is not made. The Republicans are ready to accept a debt extension to $31.4 trillion in exchange for budget cuts for the next year. The Democrats, however, are reluctant to make cuts to the government budget, as any cut will negatively impact millions of Americans.