As we step into 2025, the financial landscape is marked by a stark contrast to the exuberance of 2024, a year that saw unprecedented highs in the markets. The euphoria of record-breaking gains has given way to a more cautious and uncertain outlook. Please join me for a lively, informative discussion about the multi-faceted challenges I expect us to encounter in the new year. I’ll share my economic forecast, as well as ideas, strategies, and opportunities for maintaining a balance between sustaining growth and mitigating risks with your investments.

Last Friday’s blowout jobs report for December wasn’t what the markets were expecting, sending stocks down and Treasuries up. Here’s what’s happening this week.

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• Q4 earnings season started off with a thud from last Friday’s first reports from big finance; this week’s second round is Wednesday, with numbers due from JPMorgan Chase, Wells Fargo, Blackrock, Citigroup, Charles Schwab, Kinder Morgan, and Bank of New York/Mellon Corporation. Thursday earnings are due from Taiwan Semiconductor, UnitedHealth, Bank of America, Morgan Stanley, PNC Financial, U.S. Bancorp, First Horizon, and JB Hunt Transport, followed Friday by Truist Financial, Fastenal, State Street Corporation, Regions Financial, and Huntington Bancshares. *

• The first major U.S. inflation report is due Wednesday, with the CPI (Consumer Price Index) for December expected to show a 0.3% increase on a monthly basis. While the Fed was confident that inflation had moderated enough to start cutting interest rates in September, the pace of annual inflation has remained above the Federal Reserve Board’s 2% target. The Fed is widely expected to pause its rate-cutting cycle at its next meeting at the end of the month, but firmer-than-expected CPI data could push back market projections for further easing even later in the year. **

• The Commerce Department releases its monthly snapshot of U.S. retail sales on Thursday. Analysts forecast that retail sales edged lower in December by 0.5% after rising a month earlier. Consumers have generally kept spending, despite the cumulative impact of three years of excess inflation and high interest rates. ***

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