The drop in April’s consumer price index was a much-needed step in the right direction in the Federal Reserve's effort to tame inflation and provided hope for potential rate cuts this year. Retail sales, in another key report released on Wednesday, indicated a much weaker April, explaining the extended ... READ MORE >
Economics
Producer price offers mixed result ahead of CPI release
The producer price index increased by 0.5% in April, above estimates, as both goods and services prices accelerated, according to Bureau of Labor Statistics data released on Tuesday. The increase, however, was offset by a downward revision to March’s number, from a 0.2% increase to a 0.1% decline. That ... READ MORE >
Interest rate volatility: Why Fed policy guidance is less effective
In less than a year, the 10-year yield has moved more than 350 basis points in both directions, a volatility not seen since the financial crisis. The MOVE Index, a measure of bond market volatility, has experienced what can politely be called excessive volatility since the Federal Reserve started ... READ MORE >
How Canada can improve its lagging productivity
Increased productivity is a rising tide that lifts all boats, and the lack of it stifles growth. By keeping inflation low while improving efficiency, it is a kind of virtuous cycle that benefits consumers and businesses alike. Yet Canada’s productivity has stagnated, and, not surprisingly, so has ... READ MORE >
Intervening in foreign exchange markets: The poverty of dollar devaluation
The United States has become a magnet for global capital as investors flock to its resilient economy because of interest rate and growth differentials between the U.S. and its major trading partners and a structural budget deficit featuring robust spending on infrastructure, supply chain resilience and ... READ MORE >
U.S. consumer sentiment plunges on rising inflation
The sharp drop in consumer sentiment in May seems more like an overreaction to rising gasoline prices and overall inflation, rather than a reliable indicator for future spending. Inflation expectations rose sharply to 3.5% from 3.2% for the next 12 months while longer-term expectations inched up to ... READ MORE >
Canadian economy showed resilience in April, adding 90,400 jobs
Resilience in the economy should not be a reason to delay rate cuts. While the stronger-than expected job report released on Friday speaks to the resilience of the Canadian economy, the long-term trend is an undeniable weakening in the job market. In April, Canada added 90,400 jobs, far surpassing ... READ MORE >
Initial jobless claims rise to the highest level since August
Initial jobless claims rose by 231,000, the highest level since August, for the week ending May. 4 partly because of a one-time surge in New York as school vacations began. At the same time, new filings rose in many other states as well in a sign of rising layoffs and a cooling labor market. But the ... READ MORE >
Senior Loan Officer Survey: Progress halts as inflation rebounds in Q1
Progress toward normalization in lending practices generally halted in the first quarter as the Federal Reserve turned more hawkish amid the rebound in inflation, according to data in a Fed report released on Monday. The Senior Loan Officer Opinion Survey on Bank Lending Practices showed that demand ... READ MORE >
U.S. monthly employment report: Hiring cools in April
Hiring cooled in April from the torrid pace of 269,000 jobs on average during the first three months of 2024, as the economy generated an average increase of 175,000 positions in total employment and enters the second quarter of the year, according to data released on Friday from the Bureau of Labor ... READ MORE >