US Economics Update Recovery not being driven by a new credit boom The Federal Reserve's third-quarter financial accounts help to dispel two myths about the recovery. First, the pick-up in GDP growth over the past few quarters is not being driven by a renewed boom in... 11th December 2014 · 1 min read
US Economics Update Fed should watch the NFIB not JOLTs The NFIB small business survey is more useful than the JOLTs survey since it tells us what is going to happen to labour market conditions rather than what has just happened. It suggests that payrolls... 9th December 2014 · 1 min read
US Economics Update Losing faith in the ISM surveys We are concerned that the ISM activity indices are painting a misleading picture of the strength of the economy. We’re inclined to place more faith in the Markit PMIs, which point to more realistic... 3rd December 2014 · 1 min read
US Economics Update Slump in oil price will provide a net boost to US economy The US is still a large net importer of crude oil, so the recent collapse in oil prices will provide a net boost to real economic growth of about $150bn or 0.8% of GDP. 2nd December 2014 · 1 min read
US Economics Update This holiday shopping season could be the best in nine years Regardless of what happens on Black Friday, other more useful indicators suggest that this holiday shopping season could be the best in nine years. 20th November 2014 · 1 min read
US Economics Update Is QE in Japan and Europe good or bad for the US? Although the Fed recently concluded its quantitative easing (QE), the Bank of Japan has announced an expansion in the pace of its own asset purchases and the ECB is edging closer to full-blown QE. We... 18th November 2014 · 1 min read
US Economics Update Monetary Indicators Monitor (Oct.) The growth rate of broad money has eased, as the Fed has wound down its asset purchases and expanded its reverse repo and term deposit facilities. As the Fed expands the use of those liquidity... 18th November 2014 · 1 min read
US Economics Update Fed running out of reasons not to hike rates With the unemployment rate now within a whisker of most estimates of the natural rate and more comprehensive measures of wage growth showing a clear acceleration, we believe that the markets are too... 12th November 2014 · 1 min read
US Economics Update Conditions in place for consumption growth to accelerate Even though consumption growth lost momentum at the end of the third quarter, the conditions for stronger growth are falling into place ahead of the crucial holiday shopping season. 6th November 2014 · 1 min read
US Economics Update Midterms don’t alter the economic landscape Although the midterm elections have tipped the balance of political power towards the Republicans and could kick start progress on some trade and energy policies, they don’t alter the economic... 5th November 2014 · 1 min read
US Economics Update Banks still easing credit conditions despite end of QE3 The Fed's latest Senior Loan Officer Survey indicates that commercial banks are making it easier for households and smaller businesses to obtain credit, suggesting that the Fed's QE taper has had no... 3rd November 2014 · 1 min read
US Economics Update Q3 GDP growth treat included a seasonal adjustment trick The reported leap in third-quarter defence spending, which added 0.7 percentage points to annualised GDP growth was, as far as we can tell, largely due to a failure of the BEA’s seasonal adjustment... 31st October 2014 · 1 min read
US Economics Update Faster wage growth could prompt Fed to hike rates The survey-based and anecdotal evidence has been pointing to a sharp acceleration in wage growth for some time, yet the growth rate of the monthly average hourly earnings measure has remained... 31st October 2014 · 1 min read
US Economics Update Fed halts QE3 and takes slightly more hawkish stance As expected, the Fed today announced an end to its third round of large-scale asset purchases (aka QE3). Slightly less expected, however, is that despite the recent market volatility, the statement... 29th October 2014 · 1 min read
US Economics Update Revising down our core inflation forecasts The indirect impact on core inflation from the recent fall in energy prices is one more reason why coreinflation won’t increase as fast as we previously expected. Nonetheless, we still think that both... 29th October 2014 · 1 min read
US Economics Update Monetary Indicators (Sep.) The tapering of the Fed's monthly asset purchases might finally be having a knock-on impact on the growth rates of the broader monetary aggregates. Our estimate of the broadest M3 measure shows that... 21st October 2014 · 1 min read
