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Weekly Commentary

Economic Commentary – May 27, 2025

Jeanette Garretty

Congress is on Memorial Day holiday until June 3 (yes, they do get better benefits than most people!), although returning to their districts and (maybe) meeting with constituents may be anything but a holiday for Representatives and Senators this year. Emotions continue to run high over the economic provisions of the House-passed tax and spending bill, with some Senators arguing for significant changes. Businesses continue to push back on erratic tariff threats, while quietly making plans for raising prices if useful end-arounds cannot be found. At the same time, it seems that a certain amount of fatigue and resignation has set in; consumers expect prices to go up— according to the Peterson Institute for International Economics, the current US tariff on Chinese goods averages 51.1%— and businesses are accepting that hoped-for revisions in their supply chains simply may not be possible. With President Trump having pushed many higher tariffs out to July, this moment feels a bit like the beginning of the summer doldrums. US economic growth appears to be tracking at 2.5% in the second quarter, double the European growth number and above the estimated full-employment growth rate for the US.  The question of whether this is the calm before the storm or another demonstration of the remarkable resilience of the US economy is frequently asked and, as yet, cannot be answered. Enjoy the official start of summer and keep your fingers crossed around that long, tall, cool beverage of choice.  

Data to Watch

  1. US Durable Goods Orders for April, released Tuesday, May 27
  2. Federal Open Market Committee Minutes from May 7, released Wednesday, May 28
  3. US Continuing Jobless Claims for the week ended May 17, released Thursday, May 29
  4. US Personal Consumption Expenditures (PCE) Price Index for April, released Friday, May 30

Suggested Reading

  1. How the Classic Navy Blazer Became a Case Study for ‘Made in America’
  2. Your new sofa could be the first sign tariff inflation is hitting home
  3. Trump’s Trade War Sends Chill Through Southern California Port Economy
  4. Businesses are finding a workaround for tariffs — and it’s entirely legal

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