Financial markets were dominated by volatility across the board last week. Starting out with US economy, the second estimate of first quarter GDP came in stronger than originally anticipated, printing at 1.20% compared to 0.70% reported a month earlier. However, just as US equity benchmarks reached new records, momentum in the housing sector displayed deterioration in new and existing home sales, stoking concerns about the outlook. While FOMC Meeting Minutes viewed slow growth as transitory, less hawkish minutes indicated that the three rate hikes projected for the year may not materialize.
Moving to Europe, first quarter GDP in the UK was revised lower from the advance reading to 0.20% quarterly growth while the annualized pace of increase slowed to 2.00%. German GDP matched an earlier estimate for the same period, with optimism arriving after a stronger-than-anticipated preliminary manufacturing PMI. Shifting gears, Japanese officials were the recipients of positive news following the increase in both headline and core consumer inflation on an annualized basis. To cap off the week, OPEC members decided to extend oil production cuts by 9-months. Nevertheless, oil prices sank dramatically after markets digested the time frame as not long enough to make a difference in overflowing stockpiles, especially with US production continuing to climb.