Weekly economic commentary: Waiting for clarity

Wells Fargo Research Team Wells Fargo

Summary

United States: Waiting for clarity

Uncertainty continues to shape economic data. Personal spending was revised lower in Q1 but rose at a modest pace in April amid sturdy income growth. Inflation also remains in check, but we expect to see a tariff-driven bounce in goods prices in the coming months. Meanwhile, the appetite for large capex is generally weak and the housing market remains on ice.
Next week: ISM Manufacturing (Mon.), ISM Services (Wed.), Employment (Fri.)

International: Global GDP growth galore!

GDP growth data for the first quarter were released from countries all over the world this week. Canada's figures were somewhat mixed, but showed enough resilience in our view for the Bank of Canada to remain on hold next week. Sweden's growth printed to the soft side, potentially reviving the possibility of one final rate cut from the central bank. Brazil's economy continued to show resilience and India's report was mixed, but solid overall.
Next week: Switzerland CPI (Tue.), Bank of Canada (Wed.), European Central Bank (Thu.)

Interest rate watch: Mortgage rates move back up

Mortgage rates are back on the rise. According to Freddie Mac, the average 30-year commitment rate climbed to 6.89% during the week of May 29, the highest level since early February. Stepping back, mortgage rates are little changed over the past year. High financing costs remain a significant constraint on residential activity.

Credit market insights: Consumer balancing act

Betting against the U.S. consumer still looks like a losing strategy. Across several surveys, consumer credit fundamentals have stabilized over the past year after marginally weakening throughout 2022-2023.

Topic of the week: A bump in the tariff road

A U.S. trade court blocked the tariffs President Trump implemented under the International Emergency Economic Powers Act of 1977 (IEEPA) this week. While this provides tariff-rate relief, there remains considerable uncertainty around the future of trade policy.

Download the Full Report!

Author

Wells Fargo Research Team

Wells Fargo

EUR/USD advances marginally around 1.1650 ahead of US data

EUR/USD manages to ragain some poise on Wednesday, posting humble gains around the 1.1650 zone in a context of a modest selling pressure on the US Dollar prior to the release of Retail Sales and Producer Prices.

GBP/USD eases from tops, back to 1.3440

GBP/USD trades on the positive foot on Wednesday, receding from earlier highs around 1.3460 and revisiting the 1.3440 region amid a modest uptick and some selling interest surrounding the Greenback ahead of US data.

Gold looks bid, targets $4,650

Gold prices rapidely leaves behind Tuesday’s pullback and reaches record highs near $4,640 on Wednesday. The yellow metal’s uptrend remains propped up by Fed rate cut bets, lower US Treasury yields across the curve, and the slight downtick in the buck.

US Retail Sales expected to arrive moderately higher on Wednesday

The United States Census Bureau will publish November Retail Sales on Wednesday. The delayed data is expected to show that sales rose a modest 0.4% in the month, following no change in October. The figure is relevant as it corresponds most closely with the consumer spending component of Gross Domestic Product.

US economic outlook: January 2026

Jerome Powell's eight-year tenure as Chair of the Federal Reserve is coming to a close during a period of intense pressure on the US central bank and divided views among policymakers about the appropriate stance of monetary policy.

Meme Coins Price Prediction: DOGE, SHIB, and PEPE rally, catching Bitcoin's second wind

Meme coins such as Dogecoin, Shiba Inu, and Pepe recorded gains of 7% to 14% on Tuesday, signaling a potential reversal to the upside. DOGE and SHIB hold steady after the bounce back while the frog-themed PEPE extends gains, signaling further upside potential.