Weekly Market & Economic News Recap (Week of April 10, 2023)

• U.S. inflation eased in March to its lowest level in nearly two years to 5%, but underlying price pressures likely keep the door open for the Federal Reserve to consider another interest-rate increase at its May meeting. (Wall Street Journal, April 12, 2023, https://www.wsj.com/articles/us-inflation-march-2023-consumer-price-index-fa6eba99?mod=economy_more_pos6)

• Stubbornly high inflation and tight labor markets led Federal Reserve officials to signal they could raise interest rates at their next meeting despite a greater likelihood of a recession later this year. (Wall Street Journal, April 12, 2023, https://www.wsj.com/articles/inflation-report-keeps-a-may-interest-rate-increase-in-play-fd105729?mod=economy_more_pos4)

• Supplier prices fell in March, adding to signs of moderating inflation. Producer-price index declined 0.5% from prior month, largest drop since April 2020. (Wall Street Journal, April 13, 2023, https://www.wsj.com/articles/supplier-prices-fell-in-march-adding-to-signs-of-moderating-inflation-20d61755?mod=economy_more_pos2)

• Retail sales report shows Americans pulled back on big-ticket purchases as interest rates rose. Sales fell 1% in March, led by lower spending on vehicles; manufacturing output declined. (Wall Street Journal, April 14, 2023, https://www.wsj.com/articles/us-economy-retail-sales-march-2023-d86c682f?mod=economy_lead_pos2)

• Trading in U.S. government bonds has become much less volatile in recent weeks, helping fuel a rebound in corporate borrowing after a chaotic stretch that followed Silicon Valley Bank’s collapse in early March. (Wall Street Journal, April 14, 2023, https://www.wsj.com/articles/as-bond-market-turbulence-eases-companies-borrow-again-c8e72516?mod=economy_lead_pos5)

• Bank stress, inflation and rising recession odds fail to sway stocks. S&P 500 trading in tightest range since 2017 despite drama. Analysts say earnings, economic data unlikely to move much. (Bloomberg, April 14, 2023 https://www.bloomberg.com/news/articles/2023-04-14/bank-stress-inflation-and-rising-recession-odds-fail-to-sway-stock-market?srnd=null)

• Bond traders to scour bank results for signs of increased stress. Lenders in focus to gauge recession risks, need for rate cuts. Markets fully price hike by June, then pivot to cuts. (Bloomberg, April 15, 2023 https://www.bloomberg.com/news/articles/2023-04-15/bond-traders-to-scour-bank-results-for-signs-of-increased-stress?srnd=economics-v2)

• Credit Suisse downfall offers rallying cry for left and right. Parties of government criticize deal to rescue Credit Suisse. Banking debate may take back seat during October election. (Bloomberg, April 14, 2023, https://www.bloomberg.com/news/articles/2023-04-15/credit-suisse-downfall-offers-rallying-cry-for-left-and-right?srnd=null)

• Chinese exports surge as trade with Russia and Southeast Asia jumps. Shipments to Russia more than doubled in March from a year earlier. (Wall Street Journal, April 13, 2023, https://www.wsj.com/articles/chinese-exports-surge-as-trade-with-russia-and-southeast-asia-jumps-9c745ff1?mod=economy_more_pos3)