US Economics Weekly Fed to hike by 75bp despite weak GDP growth Fed officials may have briefly contemplated an even bigger hike following the news of the further surge in inflation in June but, with inflation expectations dropping back and the incoming news on... 22nd July 2022 · 7 mins read
US Economics Weekly Inflation up, but better news coming The bigger-than-expected rise in CPI inflation to 9.1% in June triggered speculation that the Fed might follow the Bank of Canada with a 100bp rate hike later this month. But the disappointing... 15th July 2022 · 5 mins read
US Economics Weekly Market moves may give the Fed an easier task With the June employment report suggesting fears of an imminent recession are misplaced, the Fed looks set to press ahead with aggressive rate hikes over the coming months. That said, recent sharp... 8th July 2022 · 8 mins read
US Economics Weekly Mounting signs of a slowdown We learned this week that consumer spending lost more momentum through the second quarter than initially thought, while the incoming survey evidence for June suggests the quarter ended on a weak note... 1st July 2022 · 8 mins read
US Economics Weekly Fed refuses to blink, as growth fears mount Chair Jerome Powell signalled this week that the Fed will press ahead with its planned series of aggressive interest rate hikes, even as evidence mounts that economic growth will be weak in the second... 24th June 2022 · 7 mins read
US Economics Weekly Economy still bending rather than breaking Evidence that economic growth has rebounded in the second quarter, alongside the likelihood of a further big rise in consumer prices in June, suggest that the Fed will press ahead with another super... 17th June 2022 · 4 mins read
US Economics Weekly Reports of the consumer’s death greatly exaggerated In contrast to reports from individual retailers, the aggregate data show that retail inventories are still lean, while the very strong May CPI data revelated no signs whatsoever of any discounting. 10th June 2022 · 6 mins read
US Economics Weekly Energy prices keep on rising The 390,000 gain in payrolls employment last month demonstrates that the real economy is holding up well, although the further rise in energy prices will put households under even more pressure. 3rd June 2022 · 6 mins read
US Economics Weekly Strong consumer; “greedflation” not a thing The 0.7% jump in real consumption in April, together with the upward revision to March’s gain leaves consumption on track for a 5% annualised gain in the second quarter. Thanks to a rapid rebound in... 27th May 2022 · 6 mins read
US Economics Weekly Spender of last resort With China’s economy hampered by its zero-covid lockdowns, and Europe’s economy suffering because of the massive surge in imported energy prices caused by the war in Ukraine, the American consumer has... 20th May 2022 · 7 mins read
US Economics Weekly Inflation looking better under the hood Fed officials will have been eyeing the flood of red on their screens this week with a growing sense of foreboding. Admittedly, for GDP growth to slow and inflation to fall, they want financial... 13th May 2022 · 6 mins read
US Economics Weekly Fed hikes as acute shortages drive up costs The latest weakness in equities isn't going to stop the Fed from continuing to hike its policy rate by 50bp in June and July, not when labour market conditions remain unusually tight and, in an... 6th May 2022 · 6 mins read
US Economics Weekly Fed to ignore Q1 GDP and hike regardless We doubt that the unexpected 1.4% annualised decline in first-quarter GDP will stop the Fed from hiking its policy rate by a bigger 50bp next week or from launching quantitative tightening. The Fed... 29th April 2022 · 8 mins read
US Economics Weekly Fed set to push harder on the brakes With Fed officials seemingly competing to try and sound more hawkish than their peers, a 50bp rate hike next month appears nailed on – even though this week also brought further tentative signs that... 22nd April 2022 · 6 mins read
US Economics Weekly Peak inflation won’t stop the Fed hiking aggressively The news that core prices rose by a more modest 0.3% in March, even as higher energy prices drove headline inflation to a 40-year high of 8.5%, explains why investors pared bets this week on how far... 14th April 2022 · 5 mins read
US Economics Weekly Fed lurching from one extreme to the other The Fed minutes revealed that officials are in a hawkish mood and, after their brief flirtation with the flexible average inflation framework last year, they are now desperate to rapidly recalibrate... 8th April 2022 · 8 mins read
