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Weekly Economic Update

Posted: June 25, 2018

Tariff Talk Intensifies

Major economic powers proposed additional import taxes last week, as investors wondered if a global trade war was now underway. Monday evening, President Trump stated that he had instructed U.S. Trade Representative Robert Lighthizer to identify another $200 billion of Chinese products to subject to a new 10% import duty. Shortly before the trading week began, the European Union proclaimed it would place import taxes on $3.3 billion of U.S. products, in retaliation to recently imposed metals tariffs. Friday, President Trump mulled imposing a 20% tax on autos arriving from the E.U. unless it lifts such import duties.1,2

Existing Home Sales Weaken Slightly

A National Association of Realtors report says that sales tapered off 0.4% in May. While the inventory of homes listed grew 2.8% in the fifth month of the year, the median price of an existing home hit an all-time peak of $264,800. The sales pace was 3.0% slower than in May 2017.3

Housing Starts Rise, But Permits Fall

While home sales were nearly flat last month, groundbreaking increased 5.0% according to the Census Bureau. Its latest report on U.S. residential construction also noted a 4.6% drop in building permits, far exceeding the decline seen in April.4

Blue Chips Shed 2%

To be precise, the Dow Jones Industrial Average lost 2.03% last week, sinking to 24,580.89 at Friday’s close even with a 119-point Friday gain. Faring better, the Nasdaq Composite retreated 0.69% to 7,692.82 in the same time frame, while the S&P 500 declined 0.89% to 2,754.88.5

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CITATIONS.
1 - npr.org/2018/06/18/621227483/trump-asks-for-200-billion-more-in-tariffs-to-impose-on-china [6/18/18]
2 - fortune.com/2018/06/22/trump-tariffs-european-cars/ [6/22/18]
3 - briefing.com/Investor/Calendars/Economic/Releases/exist.htm [6/22/18]
4 - investing.com/economic-calendar/ [6/19/18]
5 - markets.wsj.com/us [6/22/18]

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