GDP First Release - Stagflation
This release does not include the effects of actual tariffs, but more reflects the chaos and confusion /uncertainty around the size, purpose and impact of impending tariffs.
Inflation deflator higher than expected, so next step is recession, barring no changes in policies. Most trade policies take quarters to come to an executable agreement.
So backward accounting looks are a deteriorating economy, and the Fed will not try to save the economy right away, and treasury bonds may become more risky to hold, so interest rates may rise more than expected.
Holding Treasuries, the question for why the bonds will move:
1 - inflation higher? = bonds down/rates up
2 - recession? = bonds up/rates down
3 - US Dollar down? = bonds down / rates up
good luck to us!
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