Big Victory For The Fed? Soft Landing Looking More Likely, Recession More Remote

New data keeps showing a strong and remarkably resilient U.S. economy:

• Capacity utilization increased by 0.3 percentage points in April to 79.7 percent, very close to the long-term norm
• Consumer spending grew at a very strong 3.7 pace during the first quarter even after adjusting for inflation
• Sales of new homes during March were stronger than expected
• Durable goods orders grew much more strongly in March than expected at a 3.2 percent annualized pace
• GDP grew at a 1.1 percent annualized pace in the first quarter, and is on track for a 2.6 percent pace in the second quarter according to the Atlanta Fed’s GDPNow

The first-quarter growth of the overall economy is not especially strong, but it is entirely consistent with the goal of achieving a “soft landing,” which would mean conquering high inflation without sending the economy into a recession.