Recession-Hard/Soft Landing
Consensus expectations for the US economy were bleak at the start of the year. In hindsight, this pessimism was excessive: real GDP expanded in the first two quarters of the year (see Country Focus). Similarly, the US Conference Board’s Coincident Economic…
After having sold off in the first five months of the year, the performance of small-cap stocks improved in June and July with the S&P 600 index gaining 13.9% in those two months. A broadening of the US equity rally – which earlier in the year was…
On Tuesday, the Job Openings and Labor Turnover Survey (JOLTS) indicated that the US labor market continues to cool. It showed job openings fell to 8.827 million in July following a downwardly revised 9.165 million in June (down from the earlier estimate of…
On the surface, the latest uptick in the General Business Activity Index of the Dallas Fed’s Manufacturing Survey suggests that manufacturing activity is no longer deteriorating at an accelerating pace. The indicator rose by 2.8 points to -17.2 in August —…
Tokyo’s headline CPI inflation fell below expectations in August, easing from 3.2% y/y to 2.9% y/y – slightly below anticipations of 3.0% y/y and the first dip below 3% in nearly one year. Similarly, the slowdown in the ex-fresh food measure from 3.0% y/y to…
The ongoing profit contraction among Chinese industrial firms underscores that deflationary headwinds dominate the domestic economy. Although the annual pace of decline of industrial profits slowed from 8.3% y/y in June to 6.7% y/y in July (a 15.5% y/y drop…
Eurozone money supply data reflect the impact of the ECB’s aggressive tightening campaign on the region’s economy. Data released on Monday showed the July M3 measure of broad money (the sum of M2, repurchase agreements, money market fund shares/units and…
The final release of the University of Michigan’s gauge of US consumer inflation expectations unexpectedly rose in August. It shows 1-year ahead inflation expectations increased by a tenth of a percentage point to 3.5% (an upwards revision from the…
The Treasury market’s reaction to Fed Chair Jermone Powell’s Jackson Hole speech was relatively tame on Friday. Although there was some volatility during the speech, the 10-year yield ended the day broadly unchanged. Meanwhile, the 2-year yield rose by 5.5…
China removed checks and balances in its political system to deal with a very dangerous economic transition. The transition is going badly, yet investors cannot rely on checks and balances to correct or prevent policy mistakes. The Taiwanese election is a looming bellwether.