According to analysts at Wells Fargo, continued strength in US data flows adds further support for three more rate hikes in 2018 from the Federal Reserve.
Key Quotes:
“Retail sales rebounded in April, with notable strength in control group sales, the component that feeds into GDP. Industrial production reached a series high, with contributions from all industry groups. Housing starts contracted on the month, however builder optimism remains relatively high.”
“Moreover, industrial production reached a new high in April, with contributions from all three industry groups. The renewed strength in the index has been supported by the rebound in energy prices. Mining output increased 1.1 percent in April, marking the third straight monthly gain for this category.”
“The soft and hard data continue to support one another, a signal of stable and balanced growth. The April print adds further evidence that economic growth will continue through 2018, and suggests the Fed will continue to administer rate hikes in 2018 and 2019.”
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