US Economy: Steady growth amidst global uncertainty
J.P. Morgan Wealth Management
As U.S. equity markets have experienced another round of heightened volatility, questions have risen as to the underlying health of the U.S. economy and whether a recession is on the horizon. When it comes to analyzing the building blocks of U.S. economic activity, there are two different types of data that we look to. The first is known as soft data indicators – think gauges that reflect perceptions, opinions and expectations for economic conditions – these are sentiment surveys and essentially act as a vibe check on how investors and business owners are feeling about the state of the economy. Recently, these indicators have shown some weakness around expectations for the future pace of economic growth, with the uncertainty around tariff policy playing an important role.
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But sentiment data is only one part of the equation. The second is what we call hard data indicators, which provide insight into ‘real’ economic activity – think unemployment figures and retail sales. So far, these indicators have shown continued resilience of the labor market and of consumer spending – the biggest driver of U.S. economic growth. For now, while the vibes have downshifted, we don’t see a moderation in sentiment translating into a near-term slowdown in real economic activity, which keeps us optimistic on the health of the overall U.S. economy this year.
To be sure, equity market volatility is likely here to stay as markets digest the latest announcements regarding Donald Trump administration policies, especially around tariffs. Recent market volatility serves as a reminder to review investment allocations and ensure they align with long-term financial goals. Diversifying across different regions and asset classes could enhance portfolio resilience and help navigate periods of heightened global uncertainty.
U.S. sentiment data has moderated, but jobs growth still steady
All market and economic data as of 03/11/25 are sourced from Bloomberg Finance L.P. and FactSet unless otherwise stated.
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J.P. Morgan Wealth Management
