US Economics Update Does the Fed actually need to cut rates? Despite the run of stronger activity data in recent weeks, the deterioration in the survey evidence, lingering uncertainty over trade policy and the prospect of a prolonged period of below-target... 18th July 2019 · 3 mins read
US Economics Update Debt ceiling crisis brewing Reaching a bipartisan deal to raise the debt ceiling by early September should be a relatively straightforward exercise, but the increasingly confrontational relationship between President Donald... 17th July 2019 · 3 mins read
US Economics Update Leading indicators point to slowdown, not recession Leading economic indicators underline that most of the recent weakness has been confined to the export-orientated industrial sector, suggesting the risks of an outright recession are contained for now... 10th July 2019 · 2 mins read
US Economics Update Powell signals that July rate cut a done deal Chair Jerome Powell’s semi-annual testimony to Congress indicates that, despite the trade truce following the recent G20 meeting and the strength of employment growth in June, the Fed intends to push... 10th July 2019 · 3 mins read
US Economics Update Lower rates failing to boost business investment The latest NFIB and JOLT surveys point to a contraction in business equipment investment and suggest that labour market conditions are starting to soften. 9th July 2019 · 2 mins read
US Economics Update Latest pick-up in productivity growth unlikely to last The recent acceleration in productivity growth to a decade high of more than 2% y/y has renewed hopes that we could finally be seeing a structural pick-up linked to a new wave of technological... 9th July 2019 · 4 mins read
US Economics Update Currency intervention would fail without Fed’s full support President Donald Trump’s recent tweets have sparked speculation that, as part of an escalation of the trade war, he could order the Treasury to intervene in foreign exchange markets to manipulate the... 8th July 2019 · 6 mins read
US Economics Update State & local government investment boom won’t last The unprecedented surge in state & local government investment, which added close to 0.4%pts to annualised GDP growth in both the first and second quarters, is unlikely to be sustained. This is... 3rd July 2019 · 2 mins read
US Economics Update Monetary Indicators Monitor (May) Broad money growth accelerated to a decade high in May, as past increases in interest rates boosted portfolio demand, but the more recent renewed slump in rates will trigger a slowdown in the second... 3rd July 2019 · 3 mins read
US Economics Update Solid fundamentals will prevent consumer meltdown With the economic slowdown feeding through to weaker job gains, the apparent surge in consumption growth in the second quarter will not be sustained. But the strength of households’ balance sheets and... 1st July 2019 · 3 mins read
US Economics Update Fed breaks new ground forecasting rate cuts The Fed is now leaning towards lower interest rates later this year, but we still believe that the first rate cut will be delayed until September, with another 25bp reduction coming in December and... 19th June 2019 · 1 min read
US Economics Update Mexico tariffs pose significant risk for the autos sector The impact on prices of a 25% tariff on Mexican imports would be partly offset by a sharp drop in the peso. But the potential disruption to the motor vehicle industry, which relies on a continued flow... 7th June 2019 · 1 min read
US Economics Update Factoring the escalating trade war into our forecasts We are now incorporating a further escalation in the trade war with China into our global forecasts. We think that will knock a few tenths off annual US GDP growth this year and next. Core PCE... 6th June 2019 · 1 min read
US Economics Update US importers switching suppliers to avoid tariffs In response to the tariffs imposed on China, US importers are switching to alternative suppliers in Asia, which could explain why custom duties revenues have fallen back in the past couple of months... 3rd June 2019 · 1 min read
US Economics Update Trump tariffs pose a growing threat to the outlook President Donald Trump’s shock announcement of tariffs on Mexican imports could be challenged by Congress, but the possibility that both Mexican and Chinese imports might be subject to a blanket 25%... 31st May 2019 · 1 min read
US Economics Update Next round of tariffs to have a more significant impact The latest escalation in trade tensions could become a bigger drag on the US economy than previous rounds of tariffs. A 25% tariff on all imports from China would be equivalent to a tax worth 0.6% of... 21st May 2019 · 1 min read
