author avatar
Mark Chandik

Jul 31, 2023

Defying Expectations

Weekly Market Commentary

Gross Domestic Product (GDP) is a very broad measure of the value of goods and services in the economy over a certain period.

Last week, the U.S. Bureau of Economic Analysis reported that GDP rose at an annual pace of 2.4% in Q2, accelerating from Q1’s 2.0% and topping the forecast of 2.0% (Wall Street Journal).

Sometimes, we analyze the quarterly change and find that one-off factors aided or detracted from the headline number. This time, however, that was not the case.

Although consumer spending slowed a bit, strong spending and investment by businesses more than made up for any slack. It’s also worth noting that the many recession predictions made since the start of the year continue to miss the mark.

Meanwhile, the Federal Reserve hiked its key rate by 0.25 percentage points to 5.25 – 5.50%, the highest in 22 years.

The fast pace of rate increases last year has been replaced by a much more subdued posture, which has helped fuel the recent stock market advance.

The Federal Reserve didn’t shut the door on another rate hike (or hikes) this year, but it didn’t provide much detail on the timing or certainty of an increase. Much will depend on the economy and inflation. And that’s a bit of an unknown, even for the best economic forecaster.

author avatar
Mark Chandik

Reproduction Prohibited without Express Permission. Copyright FDP Wealth Management. All rights reserved. Advisory Services offered through FDP Wealth Management, LLC, a state Registered Investment Adviser and Valmark Advisers, Inc. a SEC Registered Investment Advisor. Securities offered through ValMark Securities, Inc., Member FINRA/SIPC. 130 Springside Drive, Suite 300, Akron, OH 44333-2431 800.765.5201 Prosperity Partners and FDP Wealth Management, LLC are separate entities from ValMark Securities, Inc. and Valmark Advisers, Inc. Prosperity Partners, FDP Wealth Management, LLC, ValMark Securities, Inc., Valmark Advisers Inc., and their representatives do not offer tax advice. You should consult your tax professional regarding your individual circumstances. Indices are unmanaged and cannot be invested directly in. Past performance is not a guarantee of future results.

Indices are unmanaged and do not incur fees, one cannot directly invest in an index. You should consult your tax professional regarding your individual circumstances. This information is provided by Financial Jumble, LLC. Financial Jumble, LLC is a separate entity from ValMark Securities, Inc. and ValMark Advisers, Inc.

RELATED POSTS

Looking Past the Pump: A Granular Look at Gasoline Prices

There are fears that higher prices will exacerbate inflation and hurt the economy, as cash that might have gone to other items will be diverted to the gas tank.

The War and Its Impact – So Far

What is the efficient market theory? Textbooks have been written to fully explain the theory. But if we can sum it up in one sentence: Assets, such as stocks, reflect all publicly available information. It is a foundational principle of finance.

Navigating Volatility

Over the weekend, global markets were shaken by significant geopolitical developments, as the US and Israel carried out coordinated strikes on Iran that resulted in the death of Iran’s Supreme Leader. Iran responded with missile strikes, which escalated tensions and heightened uncertainty in global markets.

Q4 Government Shutdown Drafs on GDP Supreme Court Blocks Tariff Plan

The government shutdown proved to be a far greater drag on the economy than earlier estimates indicated. On Friday, the U.S. BEA reported that fourth-quarter Gross Domestic Product (GDP), the largest measure of economic output, grew at a 1.4% annualized pace. This compares with a 4.4% annualized pace in Q3.

Revisiting 2025 Employment

The US Bureau of Labor Statistics published its final benchmark revisions covering employment during the 12‑month period between April 2024 and March 2025. The revisions showed that payrolls were revised lower by 898,000 jobs compared with the originally reported figures.