The official economic forecast for 2023 is still cool, but a plethora of indicators suggest things have been warming, not cooling, in the first month of the year. Auto sales had their best month since the first half of 2021. The housing market improved as mortgage rates fell below 6%, attracting more buyers. And Friday’s jobs report was surprisingly strong.
Now that inflation is showing signs of slowing, the Federal Reserve also seems less determined to raise the unemployment rate. When you add it all up, maybe it’s business leaders who need to relax a bit. Instead of all the noise we heard during earnings season about preparing for a recession, perhaps executives should prepare to respond to a stronger-than-expected growth environment. That would be better for their businesses and could help prevent the economy from repeating the congested supply chains and under-supplied inventories it experienced not too long ago.
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