Alberto G. Musalem, President of the St Louis Fed, has expressed concerns regarding recent consumer and housing data, indicating potential downside risks. While the outlook remains for solid growth, he emphasises a patient approach to policy in order to meet the Federal Reserve’s objectives.

Musalem plans to closely monitor inflation expectations if conflicts arise between the Federal Reserve’s dual goals. Currently, longer-term inflation expectations appear to be broadly stable. Though he expects the economy to continue growing, he has concerns regarding potential signs of weakening consumption or reduced business confidence in the future.

Uncertainty In Consumer Spending

Alberto’s remarks reflect uncertainty about how consumer spending and the housing market could shift in the months ahead. While broader economic growth appears stable, he is not ignoring the possibility that demand could weaken. Any slowdown in consumer activity or hesitation from businesses to invest may influence future decisions.

Monetary officials are adopting a cautious stance, with patience taking priority over any rush to adjust policy. Inflation expectations remain steady for now, but that does not mean policymakers consider the job finished. If inflation data begins to diverge from forecasts or market conditions show signs of stress, adjustments may follow.

We should particularly note Alberto’s attention to potential conflicts between price stability and employment targets. If inflation does not ease as expected, or hiring slows more than anticipated, there may be difficult policy choices ahead. He has not suggested any immediate course of action but remains focused on ensuring long-term goals are met without unnecessary disruption.

External risks are also a factor in this approach. Changes in global trade, ongoing geopolitical tensions, or unforeseen disruptions may shift expectations faster than previously thought. Officials are unlikely to react to short-term noise, but sustained signs of strain would be harder to ignore.

Outlook And Policy Readiness

At this point, we can take away a few things. Expectations continue to lean towards steady growth, but not without risks. Consumption trends, business sentiment, and inflation remain central to upcoming decisions. Policymakers remain on guard, prepared to respond if needed, but are not rushing to adjust anything unless a change is warranted.

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Donald Trump has a packed schedule planned for the afternoon. He is expected to announce decisions regarding tariffs on Mexico and Canada.

Additionally, a meeting is scheduled to discuss the situation in Ukraine. One agenda item includes the potential suspension of military aid from the United States.

Trade Policy Announcements

Donald has a busy afternoon ahead, with important announcements lined up. He is set to reveal his decisions on tariffs involving Mexico and Canada, a matter that has already drawn plenty of attention. These measures could have a direct impact on trade flows, potentially affecting prices and supply chains across industries.

Later in the day, discussions will turn to Ukraine. Among the topics is a proposal to halt military assistance from the United States, a move that would carry both economic and political consequences. If this decision moves forward, there could be immediate reactions in the markets tied to defence contracts and international relations. Investors will need to assess how this might shift expectations in both the short and long term.

With Donald’s agenda packed, traders should remain aware of market sensitivity. Policy changes like tariffs and military funding affect risk calculations, particularly when uncertainty is high. Any shift in sentiment could alter positioning in currency and commodities markets, with knock-on effects in bonds and equities.

Market Reactions And Expectations

The next few weeks are likely to be fast-moving. Keeping a close eye on statements and decisions will help in making sense of the possible reactions across multiple asset classes. As events unfold, the direct link between policy announcements and pricing movements will become clearer. Watching for shifts in expectations could provide useful insight when positioning for the coming sessions.

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The GDPNow US growth tracker has decreased to -2.8% for Q1, down from the previous estimate of -1.5%. This adjustment follows recent data releases from the US Census Bureau and the Institute for Supply Management.

The nowcast for first-quarter real personal consumption expenditures growth dropped from 1.3% to 0.0%, while real private fixed investment growth fell from 3.5% to 0.1%. This marks a 5-percentage point shift in just two business days.

Economic Momentum And Demand Weakness

A change of this size in such a short time is not something to overlook. When projections fall this sharply, they are signalling more than just minor adjustments. The revision reflects weaker-than-expected demand and investment, both of which are fundamental to economic momentum. A flattening in personal consumption expenditures indicates that households are spending less than anticipated, while the near-stagnation in private fixed investment suggests businesses are growing more cautious.

This shift did not happen in isolation. Incoming data from the Census Bureau and the ISM played an important role, feeding into the model and pushing expectations downward. The recalibration highlights how quickly sentiment can adjust when fresh numbers challenge prior assumptions. It also reflects how sensitive GDP tracking tools are to new inputs, especially when those inputs align with a broader cooling in activity.

We should take note of the speed at which the adjustment occurred—a five-percentage point movement in two business days is rare. Such a sharp correction suggests that earlier estimates may have been misaligned with underlying trends, rather than just reflecting normal fluctuations. A downward revision of this scale raises concerns about how other economic indicators might adjust in the coming weeks. If similar patterns emerge elsewhere, confidence in near-term stability could falter further.

Understanding what is happening beneath the surface is just as important as seeing the final numbers. A flat reading for personal consumption suggests that spending patterns may be shifting, potentially in response to tighter financial conditions or changes in income expectations. Meanwhile, a near halt in private fixed investment implies that companies may be reconsidering expansion efforts. If businesses continue holding back on capital commitments, the effects could extend beyond just a quarterly GDP reading.

Market Sentiment And Future Expectations

Economic forecasting models are built to adjust when fresh data comes in, but it is worth recognising the broader message they are sending. This latest shift is not just a minor recalibration—it reflects a reassessment of growth prospects at a time when many were hoping for stability. These revisions carry weight because they influence expectations and, in turn, market positioning.

In the coming weeks, the focus will be on whether additional data reinforces this downtrend or offers some counterbalance. If further releases continue to disappoint, assessments of future activity will need to adjust again. Markets are sensitive to these recalibrations, and how they adapt will depend on whether upcoming numbers confirm or challenge the current trajectory.

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Howard made it clear that the President is weighing his options on tariffs, with an announcement scheduled for tomorrow. Although actions have been taken to strengthen border security, he believes more must be done to tackle the fentanyl crisis.

Trade Policy Considerations

This suggests that trade policy is being viewed as a tool to address broader concerns, rather than being considered in isolation. Given this, we need to examine how markets might react. If new tariffs are introduced, sectors reliant on international supply chains could see increased costs. This would likely influence pricing strategies, corporate earnings, and, in turn, market sentiment. For those who track price movements closely, sudden volatility could present opportunities but also raise risks that require adjustments in strategy.

Howard’s suggestion that existing measures are insufficient also raises the possibility that this will not be the last major policy shift. If tariffs are used as leverage on other matters, further announcements could follow. Recent history shows that abrupt shifts in trade policy have sometimes led to extended market turbulence. Participants will need to stay alert for additional signals beyond tomorrow’s statement.

Market Reactions And Future Moves

What comes next will depend on how this decision aligns with the expectations already reflected in pricing. If the outcome largely matches predictions, reactions could be limited. But if the administration delivers something unexpected, whether through scope or severity, there may be knock-on effects beyond immediate price moves. Those tracking this closely will need to stay flexible, as ripple effects could spread across multiple sectors.

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In January 2025, US construction spending decreased by 0.2%, which was below the expected figure of 0.0%. This follows an increase of 0.5% in December 2024.

January’s construction spending in the United States contracted by 0.2%, failing to meet the forecasted flat reading of 0.0%. This comes after December saw a 0.5% rise, marking a slowdown at the start of the year. With expectations pointing to stable expenditure, the downward revision raises doubts about building activity moving forward.

Impact On Economic Output

The latest figure suggests reduced momentum in one of the key areas of economic output. Homebuilding, commercial projects, and public works all contribute to how capital is deployed, shaping demand in various industries. Weakness in these areas can filter through to materials, employment, and financing, leading to ripple effects beyond construction itself. Given last month’s decline, adjusting risk assessments might be necessary.

For those monitoring broader economic movements, this shift matters. December’s stronger reading had indicated resilience, but that optimism did not carry over into January. If further declines occur, longer-term trends could change, influencing not only investment decisions but also other market segments tied to building and infrastructure. This means upcoming reports will need closer attention, particularly in determining whether January’s decline was an outlier or the start of a more persistent slowdown.

Future Considerations

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The Canada S&P Global Manufacturing PMI for February 2025 recorded a decline to 47.8, down from 51.6 in the previous month. Input cost inflation hit its peak since April 2023, influencing both consumer spending and corporate investment.

Tariff uncertainties on goods crossing the Canada-United States border have negatively affected the manufacturing sector. The survey indicated a notable decrease in output, driven by falling new orders both domestically and internationally.

Decline In Manufacturer Confidence

Manufacturers are now exhibiting lower confidence levels, the weakest since April 2020. This downturn has led to reductions in purchasing and employment since January, compounded by rising input prices attributed to a stronger US dollar.

A reading below 50.0 indicates contraction, meaning factory activity in Canada has weakened in February. This drop below neutral follows a brief expansion in January, highlighting a sharp turn in sentiment. With firms scaling back purchases and cutting jobs, concerns over future demand have risen sharply. The pressure from higher costs has led to tighter spending within businesses, limiting new investment and hiring.

Price increases, mainly influenced by currency fluctuations, have compounded these challenges. A stronger US dollar has raised the cost of imported materials, narrowing profit margins. Firms have struggled to pass these costs onto clients, leading to squeezed earnings. At the same time, uncertainty over trade barriers has discouraged long-term planning, affecting both production schedules and inventory decisions.

Economic Risks And Business Strategy Shifts

For those tracking these developments, the combination of weaker demand and rising costs presents a complex set of risks. The decline in factory orders, particularly from buyers abroad, reflects a broader pullback in global trade. The effects of this stretch beyond just output figures; they shape market expectations around economic momentum in Canada.

Survey respondents reported hesitancy in committing to capital spending, mirroring patterns last seen in early pandemic months. This reluctance suggests concerns about the broader economic environment, making near-term forecasts sensitive to any further disruptions. If cost pressures remain unchecked while orders continue to decline, businesses may shift strategies further, adopting more defensive positions in spending and hiring.

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Claudia Sheinbaum stated that her team has backup plans in place and will communicate their decisions shortly. She emphasised the importance of making independent choices regardless of developments in the United States.

In a previous statement, Sheinbaum advised maintaining composure and not misinterpreting President Trump’s remarks. She noted that discussions on security and trade continue, with an agreement expected to be finalised within the week.

Consistent Approach

Today’s remarks align with her earlier comments from February, reflecting a consistent approach to the ongoing situation.

Claudia’s remarks reaffirm her position from earlier in the year, showing that her approach has not changed despite recent developments. Her assurance that alternative strategies are already being considered suggests that adjustments will be made if necessary. She has not provided a specific timeline beyond stating that updates will come soon, though her confidence implies that discussions are progressing without interruption.

Her insistence on independent decision-making, regardless of shifts in sentiment from Washington, reinforces the idea that external pressure will not dictate policy. This echoes previous statements in which she dismissed concerns over rhetoric from the United States, urging observers to focus on direct negotiations instead. The reassurance she offered today fits within this pattern, though it remains to be seen how this will translate into specific steps.

Her remarks on trade and security reflect ongoing discussions that are expected to yield concrete outcomes in the coming days. She has now reiterated that these conversations are advancing as expected, reinforcing the notion that earlier projections remain intact. The consistency in her messaging suggests that there has been little deviation from prior expectations.

Market Reactions

For those watching these developments closely, her statements indicate that existing agreements are still on track. Any adjustments that do take place will be communicated directly by her team, in line with her promise to provide clarity soon. The lack of urgency in her words suggests that there is no immediate concern, but also implies that the situation requires continued attention.

Given that she has not hinted at any unexpected shifts, the focus now turns to how markets respond in the short term. While her message is one of steady progress, reactions may vary depending on how quickly further details emerge. Until new information is released, attention will remain on upcoming announcements, particularly regarding the finalisation of agreements she referenced earlier.

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Tomorrow at midnight marks the deadline for new tariffs on Mexico and Canada to be implemented. Continued trade deficits may allow foreign countries to dominate the ownership of domestic assets.

During the previous term, inflation rates remained low. Exporting nations typically absorb a considerable portion of the imposed tariffs.

Trade Deficits And Currency Value

As trade deficits reduce, the value of the dollar tends to increase. Strategies such as deregulation and resource extraction are emphasised, with tariffs considered of lesser importance.

Timber and lumber executive orders were noted over the weekend. The outcome of these developments remains to be observed.

The deadline approaches, with financial markets bracing for the effects of these tariffs on cross-border commerce. With each restriction imposed, exporting nations reassess pricing structures, often adjusting costs rather than simply absorbing fees. A shift occurs when the balance of payments changes course—one that does not go unnoticed by those watching the movement of currencies.

The prior term saw a period of stability in consumer prices, allowing for more predictable market expectations. That stability, however, rested upon specific conditions that no longer align with the current approach. When trade deficits shrink, immediate benefits can emerge, particularly for domestic industries reliant on competitive exchange rates. Currency valuation moves accordingly, adjusting to capital flows and policy shifts alike.

Impact On Commodity Pricing

Over the weekend, executive actions targeted the timber and lumber industries, indicating adjustments that could shape broader commodity pricing. The extent to which these changes will filter through supply chains remains a focal point. With resources and deregulation taking precedence in strategic decision-making, policy directions suggest a reorientation towards domestic production efforts rather than dependence on tariff structures.

As we monitor these elements, direct implications emerge not only for raw materials but also for the pricing of derivative contracts tied to these assets. Rapid developments call for adaptability, with prior assumptions under reassessment. A more reactive approach to trade policies is increasingly necessary, as shifting priorities shape both immediate actions and long-term calculations.

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European stocks have commenced March strongly, with the DAX rising over 2% as risk sentiment improves. Major indices are experiencing solid gains at the beginning of the week, with the DAX on track for its eighth gain in nine weeks and nearly doubling in value since its 2022 low.

Other indices are also performing well, with the CAC 40 up 1.4%, the UK FTSE increasing by 0.8%, the IBEX rising 0.4%, and the FTSE MIB gaining 1.0%.

Market Optimism And Recent Trends

The upward trend follows a period of concern regarding trade policies; however, market participants have remained optimistic, resulting in substantial rewards. Last year, European stocks exhibited a similar surge early on, which paused between May and August.

The current rebound across markets is being propelled by a mix of strong corporate earnings, renewed confidence in monetary policy, and better-than-expected economic data. Investors are showing a higher appetite for risk, which is reflected in both equity performance and derivatives activity.

Looking back at last year’s pattern, there was a strong move in the first quarter, followed by a period of slower growth during the middle of the year. The similarities between now and then are hard to ignore. If momentum continues at this pace, traders will need to assess whether the trend remains sustainable or if another slowdown is likely. Shifts in inflation data or central bank rhetoric could easily alter the current enthusiasm.

Monetary policy expectations remain a key factor in maintaining the current pace. Hopes remain that central bankers will refrain from taking a more restrictive stance in the near term. Growth in European equities suggests that this expectation is still intact, but any unexpected statements from policymakers may prompt swift reactions in futures and options markets.

Valuations And Sector Performance

Another element worth considering is how valuations compare to previous peaks. Some sectors are showing signs of high valuations once again, which raises questions about how much further gains can extend without evidence of further earnings strength. If sentiment remains strong and economic indicators continue to deliver positive surprises, there may still be room for further upside.

Broadly speaking, traders need to pay attention to shifts in volatility. The recent calm suggests confidence, yet such conditions can change quickly. If volatility picks up, particularly in options markets, it will offer a clearer idea of whether market participants are hedging for declines or simply adjusting positions.

Market participants should also be mindful of how external factors are shaping sentiment. Developments in the US economy, currency movements, and commodity prices all feed into Europe’s financial outlook. A rapid change in any of these areas could send ripple effects across equity markets and, in turn, impact future positioning in derivatives.

For now, momentum trades have performed exceptionally well. However, history suggests that long periods of gains often come with phases of consolidation. If traders begin securing profits at a faster pace, short-term pullbacks are possible. On the other hand, as long as economic releases continue to align with expectations, confidence may be maintained despite minor setbacks.

It remains essential to track shifts in buying behaviour. If inflows into equities and related instruments start slowing, it could indicate that traders are waiting for the next catalyst before pushing prices higher. Likewise, any adjustments in sector rotation patterns could give clues about where market participants expect the strongest returns in the coming weeks.

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Tracking key price levels in AMD stock is vital for day traders and swing traders to make informed decisions. Price levels are understood by institutions and market makers, leading to notable reactions.

AMD stock closed at $99.86 on 28 February 2025, with pre-market trading showing an increase to $101.18. The ability to maintain above the psychological level of $100 will influence short-term trends.

Key Support And Resistance Levels

Should the stock drop below $100, notable support levels exist at $93.12, $93.70, and $94.28. Conversely, if it remains above $100, resistance levels to observe include $102.65 and $103.92.

If AMD stock breaks beyond $110, the next resistance will be at $113.20 and $116.70. Key trading strategies involve position trading, swing trading, and short selling based on these identified levels.

Volume Profile assists in pinpointing liquidity zones, while psychological levels attract trading activity. Significant resistance and support levels include $100.00, $93.12 to $93.70, and $102.65 to $110.72.

A breakdown of $100 could indicate a decline toward $93-$94, while movement above $110 might lead to gains up to $113-$116. This report aims to provide traders with a comprehensive framework for decision-making.

The pre-market move above $100 suggests growing interest at this round number, a price point that often acts as a battleground between buyers and sellers. If demand holds firm, traders are likely to capitalise on upward momentum, eyeing the next resistance levels. Staying above this threshold would indicate control in favour of buyers, increasing the likelihood of a move toward $102.65 and beyond.

However, the market does not move in a straight line. A failure to sustain levels above $100 could trigger profit-taking, forcing a retest of lower support zones. Watching $94.28, $93.70, and $93.12 becomes necessary in such a scenario, as these have historically seen buying interest. If those fail to hold, a deeper retracement may follow.

Impact Of Volume On Price Movements

Volume plays a role in determining how meaningful these moves are. Higher participation around these levels strengthens their validity. Traders who incorporate volume-based strategies should pay close attention to how much activity accompanies any breakout or breakdown. A move through resistance with strong volume suggests conviction, whereas a low-volume breakout may warrant caution.

Short-term traders will need to remain flexible. A push past $110 would not be surprising if momentum builds, with $113.20 and $116.70 marking areas where selling interest could emerge. As these levels approach, traders should monitor whether buying pressure persists or begins to wane.

In the sessions ahead, price movement around psychological barriers, alongside liquidity pockets, will provide additional clues. Reacting to these shifts with well-defined strategies becomes a key part of generating consistency. Whether focusing on intraday opportunities or holding positions for extended moves, maintaining awareness of how price behaves at these thresholds will help navigate the coming weeks.

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