The June employment report will likely reflect a surge in hiring to prepare for what will be a monumental release of pent-up demand for services over the next three months. … READ MORE >
Economics
RSM Canada Financial Conditions Index: Accommodation to continue while economy shows signs of revitalization
The RSM Canada Financial Conditions Index continues to indicate reduced levels of risk being priced into the commodity, equity, bond and money markets. … READ MORE >
May personal income and spending: Weak top line, but data looks better beyond the noise
Although personal income declined by 2% in May and personal spending was flat, according to government data released Friday, one has to look beyond the noise associated with the significant fiscal firepower unleashed early this year to understand this improvement. … READ MORE >
$1.2 trillion bipartisan infrastructure agreement reflects critical need for modernization
The $1.2 trillion agreement announced on Thursday, while it still faces hurdles, would increase long-run productivity in the economy, lift living standards and has the potential to lift the growth of economy above the current long-run rate of 1.8%. … READ MORE >
CHART OF THE DAY: Industrial trade deficit rises amid growing domestic demand
The industrial goods trade deficit increased to $36.7 billion in May from $34.39 billion in April, far exceeding pre-pandemic levels of trade deficits, according to Commerce Department data released on Thursday. … READ MORE >
Data deluge: Jobless claims ease to 411,000 as durable goods orders rise 1.1%
First-time jobless claims eased to 411,000 for the week ending June 19, a slight decline from the revised figure of 418,000 for the previous week, according to government data released on Thursday. … READ MORE >
CHART OF THE DAY: Yield spread flattens as inflation trade unwinds
The Federal Open Market Committee unleashed a sharp change in market expectations following its Wednesday meeting, helping to curtail inflation fears. The idea of the first rate hike being pulled forward into 2023 with a possibility of 2022 elicited a change in the inflation trade and a resetting of market expectations of inflation. … READ MORE >
A 2021 ‘taper tantrum’? Not likely, but requires monitoring
The potential pulling back or altering the composition of the Fed’s accommodation to the economy via the financial channel will have an impact on interest rates that will directly affect what consumers pay for homes, autos and credit card interest. … READ MORE >
CHART OF THE DAY: Fed projects U.S. will reach pre-pandemic goals by end of 2022
The Federal Open Market Committee’s projections that the economy will be back on track and meeting pre-pandemic expectations by the end of 2022 should play a role in resetting interest rate expectations by professional investors and firm managers over the next 18 months. … READ MORE >
Labor market improvement is not a one-way street: jobless claims increase to 412,000
First-time jobless claims increased to 412,000 for the week ending June 12, from a revised 375,000 previously, the government said on Thursday. However, the top-line increase remains well below the 529,200 13-week moving average within the series, implying that conditions for further improvement remain intact. … READ MORE >