The Easter weekend offered little respite for markets, and no trade deals were announced. Meanwhile, US President Donald Trump published a “non-tariff cheating” list, stating that those who criticize tariffs are “bad at business.”
The notable drop in consumer sentiment and a surge in household inflation expectations are indicative of the turbulent economic weather that lies ahead if the situation continues.
Federal Reserve Chair Jerome Powell also contributed to the dampening investor sentiment, criticizing Trump’s tariffs, while the POTUS hit back, threatening to fire the central banker.
This week’s economic data and consumer sentiment reports could further influence central bank monetary policy if there are big swings. “All signs point to more volatility this week,” said the Kobeissi Letter.
Economic Events April 21 to 25
The first major reports of the week are on Wednesday, when the Global Services and Manufacturing PMI data is released. This data provides leading economic indicators used by economists and analysts to gain insights into changing economic conditions.
March’s Durable Goods Orders report is due on Thursday, measuring the cost of orders received by manufacturers for durable goods, such as vehicles and electrical appliances. Big ticket items such as these are more susceptible to economic changes and are tied to consumer sentiment.
April’s Consumer Sentiment Index and Consumer Inflation Expectations reports are due on Friday. These reports portray the results of a monthly survey of consumer confidence levels and consumer views of long-term inflation.
Key Events This Week:
1. S&P Global Services/Manufacturing PMI data – Wednesday
2. March New Home Sales data – Wednesday
3. March Durable Goods Orders data – Thursday
4. March Existing Home Sales data – Thursday
5. Total of 8 Fed Speaker Events
6. ~20% of S&P 500 companies…
— The Kobeissi Letter (@KobeissiLetter) April 20, 2025
The US can’t escape “a looming wave of inflation,” and the government looks “ill-prepared to respond,” said Adam Posen, president of the Peterson Institute for International Economics, last week.
The Fed has been “too loose” with monetary policy, which is contributing to inflation risk, he opined before adding, “If we get inflation, the Fed will be behind the curve,” implying further rate hikes.
Additionally, around 20% of S&P 500 companies, including Tesla and Alphabet (Google), will report earnings this week in what could be a tough quarter for big tech.
Crypto Market Outlook
Crypto markets have started the week in the green with Bitcoin leading the pack as usual. Total capitalization is around $2.84 trillion as BTC reclaimed $87,000 for the first time since late March.
Analysts have said that Bitcoin has broken out of a falling wedge pattern, which could see the reversal of a three-month downtrend.
Ethereum, XRP, and Binance Coin registered minor gains, but Bitcoin was leading the markets this Monday in Asia.
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