The middle of June 2025 delivered a volatile blend of geopolitics, inflation trends, and economic uncertainty. Here’s what’s driving headlines—and decision-making—for the week of June 16–20.
🌍 Geopolitical Shockwaves: Oil Surges on Middle East Tensions
- 🛢️ Crude oil surged more than 7% after Israeli strikes on Iran triggered retaliation.
- 🚀 West Texas Intermediate closed at $72.98; Brent hit $74.23—with speculation oil could hit $90+.
- ⚠️ A broader conflict or threat to the Strait of Hormuz could spike prices another 35%.
- 📉 Stock markets dropped sharply Friday, with the Dow losing nearly 800 points (-1.8%).
👉 Context Matters: Historically, oil-driven price spikes are short-lived due to demand destruction. Goldman Sachs and JP Morgan both expect a return to the $60–65 range.
💸 Inflation and Tariffs: No Red Flags Yet—but They're Coming
- 📊 May’s CPI and core inflation rose just 0.1%, largely held down by declining energy costs.
- 🏷️ Tariff-related price increases haven’t hit full force yet—but signs are emerging.
- 🛍️ Retail goods like household and education products show early pricing pressure.
- 🚗 New and used vehicle prices actually fell, offsetting early tariff effects.
- 🧾 PPI (Producer Prices) also stayed tame, rising only 0.1% for headline and 0.2% for core.
🔮 Forecast Alert: Expect inflation to climb gradually. FTR projects core PCE inflation could exceed 3% by year-end as more companies raise prices in response to broad tariffs.
Join us for Key Issues in Transportation, a complimentary mid-year webinar that delivers expert insights on how tariffs, capacity shifts, and rate trends are shaping the freight landscape across all modes. Whether you're moving goods by truck, rail, or intermodal, this session will help you stay ahead of change and plan smarter for what's next. Register here.
📈 Sentiment Rebounds (For Now)
- 🧑💼 Small Business Optimism (NFIB) jumped 3 points to 98.8.
- 🙋♀️ Consumer Sentiment (University of Michigan) ticked up to 60.5—still historically low.
- 👔 Job growth remains stable, averaging 135K per month, with unemployment flat since March.
🏛️ Fed Watch: No Rate Moves (Yet), But Dot Plot in Focus
- 📉 The Fed is likely to stay on hold—rising inflation expectations and global risks mean caution.
- 📌 FMOC meeting this week includes new “dot plot” projections:
- 📊 Likely: 1 rate cut in 2025 (vs. 2 cuts previously expected)
- 📉 Slower growth forecasts following Q1 contraction
- 📈 Inflation projections likely revised up slightly
🎯 Bottom Line: The Fed is watching—but not rushing.
🛍️ Retail & Industrial Data: Signs of Strain
🛒 Retail Sales:
- Grew just 0.1% in April, after a hot March
- May forecast: -0.5% overall, but +0.2% ex-autos
- 🚗 Car sales hit a likely peak in April; broad price hikes coming as tariff costs ripple through.
🏭 Industrial Production:
- April was flat overall
- Manufacturing down 0.4%, motor vehicles down 1.9%
- Mining and computers also down, utilities were the only bright spot (+3.3%)
- 📉 Production expected to trend negative the rest of the year
🏠 Housing: Still Under Pressure
🧱 Housing Starts:
- April saw a 0.6% rebound, driven by multi-unit starts
- Single-family starts down, and permits dropped 4.7%
- 📉 Builder confidence down to 34 from 40 in May
- 💸 Mortgage rates nearing 7% = ongoing housing chill
🧠 Strategic Takeaways
- 🌐 Geopolitics and tariffs are increasingly driving short-term market dynamics.
- 📉 Inflation looks tame—but won’t stay that way if tariffs ripple through supply chains.
- 🧮 The Fed has more questions than answers and isn’t likely to move on rates—yet.
- 🧱 Core economic indicators suggest a slow but steady cooling across retail, manufacturing, and housing.
Need to decode how these events shape your freight or supply chain decisions? 📩 Let us know what questions you’re tracking—we’re watching the data so you don’t have to.