The Employment Cost Index—the Fed's key metric for wage growth that accounts for labor composition—slowed to the lowest level since June 2021, according to the Bureau of Labor Statistics on Wednesday. The overall index eased to 0.9% in the fourth quarter on a seasonally adjusted basis, down from 1.1% ... READ MORE >
Economics
RSM US Manufacturing Outlook Index: Pullback tempered by rise in capex
The pullback in manufacturing continued into January, with the RSM US Manufacturing Outlook Index slipping further to nearly 2.8 standard deviations below conditions that would normally be expected. But the pullback was tempered by an increase in capital expenditures, a reflection of the resilience in ... READ MORE >
Strong job openings and consumer confidence point to robust employment gains
December's strong data on job openings and consumer confidence released on Tuesday foreshadowed another robust month of job gains in January, aligning with our above-consensus estimate for net payroll increases when the employment report is released on Friday. Job openings in the United States inched ... READ MORE >
Financial conditions turn positive amid economic resilience
For the first time since February 2022, the RSM US Financial Conditions Index has turned positive amid a robust economy, strong labor market, easing inflation and rising real wages and personal disposable income. Barely above zero, our index indicates normal levels of risk being priced into the ... READ MORE >
FOMC preview: Modest adjustments will lead to pivot by midyear
The FOMC next week will almost certainly leave its policy rate unchanged between 5.25% and 5.5% and maintain the pace of quantitative tightening. The hold in the policy rate should be understood as the Federal Reserve again signaling that it considers rates sufficiently restrictive to bring down ... READ MORE >
Spending remains strong as a key inflation gauge declines toward Fed’s target
Inflation dynamics to close out last year strongly point to a near-term return to the Federal Reserve’s 2% inflation target amid a solid labor market, strong spending and real income gains. While both top-line and core inflation are rapidly advancing toward the Fed’s target, inflation-adjusted ... READ MORE >
U.S. economy booms at a 3.3% pace in the fourth quarter
The U.S. economy expanded at a robust 3.1% pace from a year ago and closed the year with a booming 3.3% rate of expansion on the quarter, according to Commerce Department data released Thursday. The strong gains were driven by household consumption, gross private investment and government spending ... READ MORE >
The case for the Bank of Canada to accelerate rate cuts
With restrictive financial conditions, high interest rates and still-elevated inflation, the Canadian economy has come to a standstill and is now at a tipping point. The Bank of Canada’s decisions over the next few months could influence whether the economy arrives at a soft landing or falls into a ... READ MORE >
A rail merger and the evolution of North America’s supply chain
The merger of two major North American railroads will create a rail network that reaches both coasts and runs through the middle of the continent. The long-sought combination of Canadian Pacific and Kansas City Southern promises to make a seamless, faster supply network that will benefit Canada, Mexico ... READ MORE >
Bank of Canada holds rates steady at 5% amid weak growth
As expected, the Bank of Canada on Wednesday maintained its policy rate at 5 per cent and continued its restrictive monetary policies. At the same time, though, its public statements signed a more dovish tone. In softening its rhetoric, the central bank noted the slowdown in the global and domestic ... READ MORE >