The report on retail sales last week revealed a solid growth of 0.1% in December, indicating a robust economic performance. Additionally, retail sales from the control group experienced an increase of 0.8%, suggesting a likely growth in the GDP for the past quarter exceeding 1.5%, in line with the expectations of the Federal Reserve.
These results support the continuity of economic growth in the United States. A noteworthy increase is evident, especially when compared to the year 2022, particularly in sectors such as online sales, which surged by almost 30%, and restaurant food, which grew by nearly 8%, becoming the primary expenditure in personal budgets.
This factor is crucial, especially in the U.S. economy, which relies on 70% of domestic consumption. However, a contraction is observed in segments like furniture and department store sales.
Regarding monetary policy, the report indicates that there is no immediate urgency to reduce interest rates. We will continue to closely monitor this matter. It's worth noting that a strong economy coupled with decreasing inflation would create a perfect environment for stock bulls even if the FED takes a little longer to lower rates, as a” soft-landing” scenario with the FED reducing rates, and the economy avoiding recession is usually an instance where stocks tend to perform better than average. Time will tell, but it seems like a great time to remain invested.