US Economics Update Yellen’s strong defence of regulation at odds with Trump Fed Chair Janet Yellen’s passionate defence of the post-crisis tightening of financial regulation in her Jackson Hole speech today isn’t going to go down particularly well at the White House. Donald... 25th August 2017 · 1 min read
US Economics Update Will the next Chair shake up Fed policy? Whoever is leading the Fed next February, policy will be driven mostly by economic developments, which we think will prompt the FOMC to raise rates four times in 2018. But a new Chair, along with... 24th August 2017 · 1 min read
US Economics Update NFIB & JOLT surveys point to pick-up in wages and investment The latest JOLT and NFIB surveys show that labour market conditions remain unusually tight and, while this is still not translating into significantly faster wage growth, it might finally be prompting... 8th August 2017 · 1 min read
US Economics Update Fed suggests balance sheet normalisation will begin in September As widely expected, the Fed left its policy settings unchanged today, while hinting that it will begin the process of winding down its balance sheet as soon as September. The Fed will have plenty of... 26th July 2017 · 1 min read
US Economics Update What does the health care debacle mean for tax reform? The apparent failure of the Senate Republicans to agree on a health care bill to replace Obamacare does not mean that President Donald Trump’s plans for a fiscal stimulus are dead and buried. 20th July 2017 · 1 min read
US Economics Update Is the manufacturing sector heading for another downturn? The prospect of a renewed downturn in manufacturing activity is a concern, particularly with activity in the mining sector also likely to be hit by lower oil prices. Despite the weakness of some of... 5th July 2017 · 1 min read
US Economics Update Health care reform could provide a small boost to economy There is still considerable uncertainty over whether Congress will vote to approve a new healthcare bill but, if it does, the short-term effects on the economy would probably be mildly positive and... 5th July 2017 · 1 min read
US Economics Update Does the flatter yield curve signal a slowdown in GDP growth? Yield curve inversions have been near-perfect leading indicators of recessions over the past forty years, but there is little evidence to suggest that the flattening of the curve that we have seen... 28th June 2017 · 1 min read
US Economics Update Fed hikes rates and plans for balance sheet normalisation As widely expected, the Fed raised its policy rate target by an additional 25bp today, to between 1.00% and 1.25% and, despite the recent weakness of core inflation, Fed officials still expect to... 14th June 2017 · 1 min read
US Economics Update Firms shun banks for other sources of finance Although the sharp slowdown in C&I bank loans over recent months has received plenty of attention, total corporate sector debt actually expanded by a record amount in the first quarter, suggesting... 13th June 2017 · 1 min read
US Economics Update Wage growth not being held back by mix of jobs created The slowdown in payroll employment growth over the past year or so has been concentrated in low wage occupations, indicating that the overall mix of jobs being created has improved. This makes the... 5th June 2017 · 1 min read
US Economics Update Debt ceiling showdown looms again Congress might need to raise the debt ceiling by late August, a little earlier than previously anticipated, and it has become increasingly clear that, even though the Republicans control both Houses... 31st May 2017 · 1 min read
US Economics Update Fed plans to begin balance sheet normalisation with baby steps The latest FOMC meeting minutes revealed that the Fed intends to gradually phase out the reinvestment of maturing securities in its portfolio. The upshot is that the balance sheet will shrink more... 24th May 2017 · 1 min read
US Economics Update Trump budget only an opening gambit The White House budget proposal for the 2018 fiscal year, which incorporates severe cuts to non-defence discretionary spending and entitlement spending, is never going to pass the Senate, which... 23rd May 2017 · 1 min read
US Economics Update How big a risk does a China slowdown pose to the US? The economic slowdown underway in China is perhaps the biggest external risk facing the US economy. However, growth would need to slow far more than we think is likely to knock the US recovery off... 22nd May 2017 · 1 min read
US Economics Update Auto sector woes not enough to knock economy off course A flood of off-lease vehicles has hit used car prices and new vehicle sales, and the glut of vehicles still in the pipeline suggests that the sector’s woes will worsen in the months ahead. But this is... 10th May 2017 · 1 min read
