As per yesterday’s report by the Commerce Department, the U.S. economy demonstrated its robustness with a better-than-expected GDP growth rate of 2.9% during the fourth quarter of 2022. Despite shouldering the burden of progressive interest-rate hikes by the Federal Reserve, economic growth moderated sequentially by just 30 bps.
Hopes of the market are high that the Fed would respond to the slowing economic momentum with an equally mild interest-rate hike and strengthen the probability of a “soft landing.” However, a 26.7% plunge in residential fixed investment, reflecting a sharp slide in housing, was a reminder that things might worsen before they start improving.
