May 23, 2017
Today's economic news is soft with new home sales slipping in April following similar April weakness in last week's housing starts report. PMI data were mixed with manufacturing posting slow rates of growth but services showing improvement.
The Trump administration released its fiscal 2018 budget which it describes as pro-growth and includes cutbacks for Medicaid together with a wide assortment of other programs but increases for defense. GDP assumptions begin at 2.3 percent for this year ending at 3.0 percent by 2020. For comparison, GDP last hit a full-year 3 percent level at the height of the last expansion in 2005.
Stocks were up slightly and bonds down slightly. The Dow rose 0.2 percent to 20,937 while demand for Treasuries edged lower with the 10-year yield up several basis points to 2.29 percent.