By Evelina M. Tainer, Chief Economist, Econoday
3/15/02

Retail sales, industrial production, business inventories and consumer sentiment all posted gains this week. For the most part the increases were mild, consistent with the view that this recovery will be moderate not robust.

Equity investors were not consistently exuberant this week but they were in a much better mood than bond investors. Economic growth spells trouble for bond investors, who would rather see sluggish activity and fear an imminent rate hike by the Fed. Former Fed governor Larry Meyer fueled the fires this week by claiming that the recovery was in fact turning out pretty strong and that the Fed would likely raise its federal funds rate target at the June meeting. Meyer ended his term on the Board of Governors in January.