Economic Factors Influencing the Bull Market

The current bull market is significantly influenced by declining inflation rates, which have decreased from 9.1% in 2022 to 2.4% today. This positive trend is complemented by a productivity boom, where the economy continues to grow despite a decline in total weekly hours worked. Businesses are experiencing improved profits, mainly because of this productivity growth alongside adequate inflation levels. Additionally, the private sector is generating unusual cash reserves, as households save more for retirement and businesses focus on paying down debt, leading to a liquidity surplus that may lower interest rates.