Company: PDSRX
Filing Date: 2025-05-28
Form Type: N-CSR
Source: 0001756404-25-000011
Chunk: 1

Company: Principal Real Asset Fund
Filing Date: 2025-05-28
Form: N-CSR
Chunk 1
---
conomic

&

### Financial
Market

Review

Global

economic

growth

continues

to

trend

lower

with

policy

uncertainty

on

the

rise,

leading

to

GDP

growth

forecasts

being

revised

lower

across

the

globe.

U.S.

economic

strength

was

in

the

spotlight

over

the

last

twelve

months,

with

2.8%

real

GDP

growth

in

2024,

though

its

growth

advantage

against

other

developed

countries

is

narrowing.

In

the

U.S.,

soft

data

(such

as

ISM

manufacturing,

consumer

sentiment,

and

consumer

confidence)

is

already

showing

weakness,

but

hard

data

(such

as

retail

sales

and

nonfarm

payrolls)

remains

intact

for

now.

Elsewhere,

the

fiscal

overhaul

in

Germany

has

the

potential

to

boost

growth

over

the

long

run,

though

short-term

headwinds

may

prove

difficult

to

offset.

In

Japan,

the

reflation

story

continues,

with

growth

expanding

thanks

to

the

ongoing

spending

recovery.

China’s

economic

outlook

has

improved

since

the

September

2024

politburo

meeting

thanks

to

additional

policy

focusing

on

stabilizing

growth.

Global

inflation

fell

from

3.5%

in

March

2024

to

2.6%

in

March

2025,

getting

incrementally

closer

to

the

central

banks’

2%

target.

In

the

U.S.,

the

easing

of

core

services

inflation

and

short-lived

labor

data

softness

allowed

the

Federal

Reserve

(Fed)

to

start

cutting

rates

in

September

2024.

However,

the

cutting

cycle

was

paused

as

Trump

administration

tariffs

may

put

upward

pressure

on

inflation.

Notably,

the

Fed

cut