View From The Summit:

No Rate Cuts In Sight

As we enter a new month, the sentiment surrounding interest rates remains cautious, with Fed policymakers signaling no immediate need for rate cuts despite previous projections. Stronger-than-expected inflation reports, particularly in housing costs, are challenging the likelihood of any rate adjustments in Q2.

Against this backdrop, we continually monitor key indicators such as population growth, job market stability, and wage growth to assess market dynamics. Population growth trends provide valuable insights into rental demand, while job market stability and wage growth metrics inform our evaluation of market strength.

Our commitment is to provide you with insights and tools to confidently navigate these evolving market conditions, ensuring that your investments remain positioned for long-term success.

Fed policymakers agree: there's no urgency to cut rates

Originally, financial markets anticipated the first rate cut in March. However, due to surprising data on the labor market and inflation, this expectation shifted to June, then September; With some extreme predictions betting we won’t see any changes until 2025.

Investor confidence in the Federal Reserve's timing and the extent of rate cuts has been unsettled by persistent inflation, a robust job market, and cautious remarks from central bank officials.

Increased inflation pressure in key areas reinforces the Fed’s stance that interest rate cuts can wait.

The housing inflation rate, including rents for homes and apartments, surged to 5.7% in March compared to the previous year at 3.3%. This spike in shelter costs has contributed to the unexpected rise in the March consumer-price index, and the subsequent delay of rate cuts.

Economists anticipate this decline to persist as more rental supply becomes available. However, the pace at which rents will decrease to levels deemed acceptable by the Federal Reserve remains uncertain.

Thomas LaSalvia, an economist at Moody's Analytics, notes that while housing inflation typically exceeds general inflation, it must decrease further to meet current standards.

Market News

From MSA's We Are Actively Evaluating

Investment Opportunities

Daisy Brand to Invest $626.5 Million in Iowa Expansion

The expansion of Daisy Brand LLC to Boone, Iowa (a secondary market of Des Moines) marks a significant investment in the state's manufacturing sector.

The Iowa Economic Development Authority (IEDA) has approved $7 million in direct financial assistance along with tax benefits for the company.

Governor Kim Reynolds highlighted Iowa's strong manufacturing environment, with a third of the nation's top food manufacturers located in the state, making it an ideal location for Daisy Brand's expansion.

Here's how De Soto, Kansas, is getting ready for massive Panasonic plant's 2025 opening.

In 2022, De Soto, Kansas (a suburb of Kansas City) was selected by Panasonic as the site of its $4 billion electric vehicle battery plant. A recent drone flight reveals the expansive facility being built upon the grounds of the former Sunflower Army Ammunition Plant.

The 4.7 million-square-foot battery plant will bring 4,000 new jobs to the region, not to mention the numerous public and private infrastructure developments well underway in preparation for the development boom. Plans call for the $4 billion plant to be in operation producing batteries for electric vehicles by March 2025.

The Path Forward:

Opportunities Exist For Those Who Are Prepared

In closing, as we reflect on the insights shared in this newsletter, it's evident that the economic landscape is evolving rapidly. The cautious stance on interest rates, driven by stronger-than-expected inflation reports, underscores the importance of staying vigilant and informed.

Despite the challenges our commitment to providing you with the tools and insights to navigate these dynamics remains unwavering. As we look ahead, it's clear that opportunities continue to emerge in key markets, signaling potential for long-term growth.

We remain dedicated to monitoring these trends closely and positioning your investments for success amidst evolving market conditions.

Thank you for your continued trust and partnership.

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