Reported by Tahir Ishaq Shehu
U.S. stocks closed at a record high last week on optimism around tariffs, but the economic outlook for the world’s largest economy remains highly uncertain.
Markets have rebounded strongly after a rocky start to the year, buoyed by renewed investor confidence. However, analysts caution that this optimism may not reflect the underlying complexities facing the U.S. economy.
“Economic modeling is very difficult right now because things are changing constantly,” Atlanta Federal Reserve President Raphael Bostic told CNBC’s Squawk Box Europe on Monday. He cited shifting global policies, including Canada’s recent reversal on its digital services tax, as an example of the unpredictable environment.
Bob Parker, senior advisor at the International Capital Markets Association, added that markets may be taking a “naive view of what’s happening on the trade front,” warning that geopolitical and trade-related uncertainties are far from resolved.
As traders continue to push stock indices to new heights, policymakers and economists remain cautious, highlighting the challenges in forecasting interest rates and long-term economic trends.
