Canada Data Response GDP by Industry (Oct.) The latest indicators point toward fourth quarter GDP growth of around 2% annualised; a better performance than third quarter growth of 1%, but nothing spectacular considering the significant excess... 23rd December 2010 · 1 min read
US Data Response Durable Goods Orders & Personal Spending (Nov.) The data releases today support our estimate that GDP growth probably accelerated to 4.0% annualised in the fourth quarter, from 2.6% in the third. The main difference is the pick up in consumption... 23rd December 2010 · 1 min read
Canada Chart Pack Economic growth to remain muted Our calculations indicate that real GDP did at least expand in October, albeit by a lacklustre 0.1% m/m. That should ease fears of a double-dip recession, after the unexpected contraction in September... 22nd December 2010 · 1 min read
US Economics Focus Has the US really avoided its own lost decade? The conventional wisdom is that America has avoided a repeat of the recent Japanese experience because its policymakers acted much more quickly and aggressively to prevent the economy slipping into a... 21st December 2010 · 1 min read
Canada Data Response Consumer Price Index (Nov.) November inflation figures support our view that sluggish economic growth is dampening inflationary pressures. Significant excess capacity and slack in labour markets are likely to keep the underlying... 21st December 2010 · 1 min read
US Chart Pack 2010 ends on a high Annualised GDP growth is on course to accelerate to around 4% in the fourth quarter, from 2.5% in the third. Moreover, the new fiscal stimulus means that we now expect growth to average 3% in 2011... 20th December 2010 · 1 min read
US Economics Weekly How far will the fiscal stimulus boost growth? The recent run of stronger economic data has prompted us to raise our fourth-quarter GDP growth forecast to 4% annualised, from 2.5%. Based on the higher starting point for GDP going into next year... 20th December 2010 · 1 min read
Asia Economics Update Korea-US trade deal good for both sides The amendments in the Korea-US free trade deal (KORUS) announced earlier this month have caused some protests in Korea, but the risk that the new arrangement is blocked by the National Assembly looks... 16th December 2010 · 1 min read
US Economics Update Fed sticks to its guns The Fed was always going to leave the size of the second round of quantitative easing (QE2) unchanged today as it is too soon to judge whether it has been a success or a failure. If we are right in... 15th December 2010 · 1 min read
Canada Data Response Monthly Survey of Manufacturing (Oct.) Manufacturing sales increased a tad stronger than we expected, though not enough to change our view on fourth-quarter GDP growth in the range of 1.5% to 2%. Indeed, looking through the monthly... 15th December 2010 · 1 min read
US Data Response Consumer Prices & Industrial Production (Nov.) Consumer price inflation remained unusually weak in November and, given the large amount of excess capacity in America's economy, we expect it to continue trending gradually lower over the next couple... 15th December 2010 · 1 min read
US Economics Update Monetary Indicators Monitor (Nov.) The rate of decline in our Capital Economics' measure of M3 has eased, while the growth rates of M1 and M2 have picked up again slightly. However, there is nothing here to suggest that inflation is... 14th December 2010 · 1 min read
Global Markets Update 2011 looks less promising for the US equity market The US equity market is ending the year with a flourish. The S&P 500 has risen by about 5% so far in December, and is not far shy of our year-end target of 1250. Nonetheless, we are sceptical the... 14th December 2010 · 1 min read
US Data Response Retail Sales & Producer Prices (Nov.) The Holiday shopping season appears to have got off to a very good start, suggesting that fourth-quarter consumption growth will be strong. But without a meaningful acceleration in real income growth... 14th December 2010 · 1 min read
Global Markets Update Is this is the beginning of the end for low US yields? We do not believe that the recent jump in Treasury yields marks the start of a prolonged bear market. Provided, as we expect, the economic recovery ultimately disappoints and the Fed keeps short-term... 13th December 2010 · 1 min read
US Data Response Negative Equity (Q3) The fall in the proportion of homeowners in negative equity in the third quarter offers little comfort since it was driven by foreclosures rather than a rise in prices. The second downward leg in... 13th December 2010 · 1 min read
