Thriving Economy: Is the US Invincible?

Consumer Confidence and Economic Outlook

In a surprising twist of fate, the number of American consumers anticipating a recession has dwindled. According to The Conference Board’s October consumer confidence index, such forecasts have reached their nadir since 2022. Moreover, optimism about equities stands at an unprecedented high.

Major Market Movements

This newfound confidence coincides with a remarkable surge in major US equity markets, exceeding a 20% growth year-to-date. However, it’s wise to note that some economists, including Dimitris Valatsas, express caution. They urge investors to weigh all potential risks. The forthcoming US election, for instance, might exacerbate the US fiscal deficit.

Federal Reserve’s Rate Cut Decision

In the midst of this economic landscape, the Federal Reserve made a noteworthy move. Last September, it decided to cut its wholesale interest rate by 0.5%. This marked the first such reduction in four years. One might ask why, amidst seemingly positive indicators, the Fed took such measures. According to insights, the decision was largely influenced by a notable slowdown in the labour market over the summer months.

Investor Caution and Market Expectations

Currently, the market predicts a near 95% probability of a 25-basis point rate cut this month. Yet, there is a wary undertone, as not all potential threats, such as the US election, have been adequately accounted for by investors.

State of the US Economy

For those curious about the intricacies of the US economy ahead of the election, Dimitris Valatsas discusses these matters on the latest episode of Markets with Madison. This programme, hosted by Madison Reidy, offers astute investment insights every Monday and Friday.

Get the insights from experts on YouTube, NZ Herald, and podcast platforms.

Travel and Financial Wisdom

Madison and video producer Corey Fleming journeyed from Auckland to New York, experiencing the Qantas difference. This includes direct flights from Auckland to New York. Navigating the upheavals of economic change is crucial, but personalising your financial strategies with advice from a qualified professional is vital.

Note to Investors

It’s paramount to remember: the information in the Markets with Madison programme is general in nature. Therefore, always consult a professional for tailored financial advice.

Madison Reidy, an authority in investment, has hosted the NZ Herald’s investment show since 2022. She brings seasoned knowledge from her previous roles in television and radio broadcasting, focusing on business and economics.

Sponsored by CMC Markets.