Monthly Economic Insights - May 2023

Our May 2023 economic insights summary:

1. NASDAQ 100 Index Rallied 8.4% in May, Fueled by AI Stocks. So far, in 2023, the index has returned 31%. Surprisingly 70% of the gains came from 6 stocks; Apple, Microsoft & Nvidia, Meta, Amazon, and Alphabet.

2. US House Passes Debt Ceiling Deal. The House approved a bill to raise the nation's debt ceiling while cutting some government spending over the next two years, averting a default crisis.

3. US Interest Rates Raised to Highest Level in 16 Years. The Federal Reserve approved its 10th interest rate increase since March 2022, bringing the Fed funds rate to the target range of 5% to 5.25%. The Fed also dropped a tentative hint that the current tightening cycle is at an end.

4. Unemployment Rate Falls to 3.4% in May, Lowest Since 1969. The U.S. unemployment rate fell to 3.4% in May. The economy added 253,000 jobs, beating expectations of 200,000. The labor force participation rate remained unchanged at 63.2%. The number of people who are employed is now at a record high.

5. US Inflation Below 5% for First Time in Two Years. In April 2023, inflation was 4.9%, down from 5% in March, which is the lowest inflation rate in two years. However, inflation is still well above the Federal Reserve's target of 2%.

6. Median Home Price Down Over 15% Since Oct 2022. The median sales price of new single-family homes in April declined to $420,800 from a median price of $455,800 in March. The median home price in Oct 2022 was $496,800. The slump comes amid a rapid rise in mortgage rates.