January retail sales data indicated a modest rebound in spending after a weaker-than-expected close to 2018. The 0.2 percent month-over-month increase in retail sales and the 0.9 percent increase in the retail sales control group figure that feeds into estimates of gross domestic product both affirm that the U.S. did not fall into recession to kick off the year. … READ MORE >
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February employment overview: uncertainty tax to damp hiring going forward
The U.S. economy has slowed over the past three months and hiring eased along with it. The economy generated only 20,000 jobs in February and the unemployment rate declined to 3.8 percent due to a combination of special one-time factors, a government shutdown and the likely pulling back of hiring by companies facing heightened uncertainty about the direction of the domestic and global economies amid sustained international trade tensions. … READ MORE >
‘Extend and pretend’–a Brexit snapshot
The British government appears to be on a course moving toward a deal to exit the European Union following critical votes on March 12. Our base case is what we would call the “extend and pretend” scenario: the government will likely ask for an extension of Article 50 until mid-to-late June of this year from a scheduled departure of March 29. … READ MORE >
The U.S. trade deficit– behind the numbers
The 2018 total trade deficit exploded to $621 billion, up 12.5 percent as imports increased 2.1 percent and exports declined by 1.9 percent. The deficit in goods merchandise soared to 891.2 billion, the highest on record in the history of the economy. … READ MORE >
Health care adds 38,600 Jobs in February, but is that enough?
Recent employment releases, while generally positive, belie a systemic problem in the health care labor market: How will health systems, payers and other providers possibly find enough of the right people to deliver the care their patients expect? … READ MORE >
Real GDP index points to sub-2 percent growth–The Real Economy
Real GDP growth in the U.S. economy continues to point to a return to below-2 percent growth during the next two years, according to a report in the February edition of The Real Economy. … READ MORE >
Q4’18 GDP shows solid above-trend growth
The U.S. economy grew at a 2.6 percent growth rate during the final three months of 2018 on the back of a 2.8 percent increase in personal consumption bolstered by a blowout 5.9 percent rise in purchases of durables and an unsustainable buildup in inventories, in addition to a 13.1 … … READ MORE >
What does the yield curve tell us about the economy?
Does a flattening yield curve signal an impending recession? Read the February edition of The Real Economy. … READ MORE >
Powell’s Humphrey-Hawkins testimony doesn’t deviate from Jan. statement
Federal Reserve Chairman Jerome Powell reaffirmed his policy outlook for the United States on Tuesday, which implies a slower pace of growth linked to increasing headwinds related to policy and global economic issues. … READ MORE >
Low interest rates alone can’t save the housing market
The government reported on Tuesday that December housing starts fell 11.2 percent—their lowest level in two years. Despite this, many remain hopeful of a bounce back by spring. We believe that optimism should be kept in check, as high home prices remain a drag on the market. … READ MORE >