Weaker consumer spending could dampen demand-driven inflation, supporting a more accommodative Fed stance.
Meanwhile, the retail sales control group, which excludes volatile components—car sales, building materials, and gas stations—rose by 1%, reversing a 1% fall in January.
Asian Market Implications: Stronger Fed rate cut bets and Wall Street gains set the stage for an upbeat Asian session on Tuesday, March 18.
OECD Raises China Growth Forecasts
On March 17, the OECD released its Economic Outlook Interim Report. Notably, the OECD raised China’s growth forecast to 4.8% for 2025, up from 4.7% while leaving its forecast for 2026 unchanged at 4.4%.
In contrast, the OECD revised its global GDP forecast for 2025, down from 3.3% to 3.1% and from 3.3% to 3.0% for 2026. Tariffs were a focal point, with the OECD highlighting the adverse effects of bilateral tariffs on Mexico, the US, and Canada. Significantly, the OECD expected tariffs to have minimal impact on China’s economy.
The OECD’s report and expectations of further monetary and fiscal stimulus from Beijing drove demand for Hong Kong and Mainland-listed stocks.
