Market Overview Analysis by Lance Roberts covering: Crude Oil WTI Futures. Read Lance Roberts's latest article on Investing.com
data suggests a robust consumer, leading economists to become even more optimistic about more robust economic growth this year. To wit:
in the January survey. That was the lowest probability since April 2022, when the chances of a recession were set at 28%.don’t think the economy will get even close to a recession. In January, they, on average, forecast sub-1% growth in each of the first three quarters of this year.Rising inflation in March didn’t deter consumers, who continued shopping at a more rapid pace than anticipated, the Commerce Department reported Monday.
Secondly, while the March retail sales data was strong, it was weaker than February. However, March contained two significant spending periods, Spring Break and Easter, which generally don’t occur. Since Spring Break and Easter are considerable travel and shopping periods, it is unsurprising that the retail sales data increased with oil prices rising. As shown below, there is a very high correlation between nominal retail sales and oil prices.
In other words, spending more for the same amount of goods and services is not a sign of economic strength.Furthermore, while the recent nominal sales data was robust, it is crucial to remember the economic data has a significant lag. Each of the dates below shows the economy’s growth rateYou will note in the table that in 7 of the last 10 recessions, real GDP growth was running at 2% or above.
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