Somewhat surprisingly, the price of gold rose on the news and the dollar showed some weakness. The primary reason was presumably lower inflation. This means the Fed still has the excuse it needs to continue the Powell Pause.
There was also some data in the Commerce Department's report that reveals shakiness in that growth number. In fact, Peter Schiff said he thinks this will likely be the strongest growth of the year.
An increase in inventories helped drive Q1 growth. This isn't necessarily a positive trend. It could mean that consumers aren't buying, causing inventories to pile up. In fact, final sales to domestic purchasers increased by only 1.4%. That represents the smallest increase in more than three years.
Trade numbers also helped boost growth. Trade deficits were lower in Q1. Trade deficits were high in the last half of 2018. Peter said he thinks that's because a lot of companies front-loaded shipments late last year in an effort to avoid tariffs.
Paul Ashworth, chief US economist at Capital Economics said, "Under those circumstances, we continue to expect that overall growth will slow this year, forcing the Fed to begin cutting interest rates before year-end."
- Source, Seeking Alpha
