Robertson Stephens Weekly Commentary – March 17, 2025

A consensus is growing that the first quarter’s economic growth has slowed to 1%, possibly less. As would be expected, this has taken some of the heat out of the inflation fire, making the Federal Reserve’s job considerably more straightforward. However, the effects of recent US fiscal actions— federal worker firings, spending cuts, and tariffs — have yet to play out and will be concentrated in the second quarter. The S&P 500 fell into “correction” territory (a drop of 10% from a recent peak) as markets continue to worry that uncertainties and potential inflation due to tariffs and the administration’s heavy-handed job and spending cuts will weigh on economic growth and, in turn, on corporate earnings. Wall Street analysts have begun reducing their economic growth forecasts as they fear that weak consumer and business sentiment will eventually manifest in actual reductions in consumer spending and business investment. On the wealth planning front, we discuss how you can manage your plan amid inflation shifts.