We think that the Federal Reserve’s current cycle of rate hikes has peaked at a range between 5.25% and 5.5%. While inflation stands well above the Fed’s official 2% target, we think that because of the economic and political shocks since the pandemic, the Fed will raise its inflation target in the ... READ MORE >
Economics
Potential impact of UAW strike would not be sufficient to cause recession
The threat of a strike among the 146,000 United Auto Workers at the so-called Big Three automakers of Ford, General Motors and Stellantis puts at risk half a billion dollars per day in an economy that generates more than $26.7 trillion in goods and services each year, or more than $73 billion per ... READ MORE >
Soft landing likely as Canada added 40,000 jobs in August
A look at August’s job report reveals clear signs of a soft landing. Canada added 40,000 jobs, smashing expectations, and offset the modest loss in July many times over. The unemployment rate was unchanged at 5.5%, according to data released on Friday by Statistics Canada. Immigration has played a ... READ MORE >
As financing costs surge, the real economy faces a reckoning: Rising loan costs are squeezing middle market firms
As the era of easy money and low-cost financing ends, middle market businesses are facing a reckoning. Rising real interest rates are pushing up the cost of commercial and industrial loans, making it harder for these firms to meet payrolls and finance their expansion, according to a new survey from RSM ... READ MORE >
Initial jobless claims fall to lowest level in seven months
Initial jobless claims dropped to 216,000 last week, the fewest since February, as the labor market remained tight, according to data from the Bureau of Labor Statistics. New claims remained far below the threshold of 250,000 that we see as signaling a recession, raising the chance that the cooling ... READ MORE >
Service sector growth in U.S. reaches a six-month high
The service sector in the United States grew faster in August on the heels of a surge in summer spending, the Institute for Supply Management reported on Wednesday. The service composite index rose to 54.5 from 52.7, marking the highest level since February. The increase was broad-based as the main ... READ MORE >
Bank of Canada holds rates steady amid a cooling economy
The Bank of Canada kept its policy rate at 5% on Wednesday as the unexpected contraction of the economy in the second quarter gave a clear message of a cooling economy. The central bank’s decision to keep rates steady also suggested that its campaign of rate increases might be over, rendering a rate ... READ MORE >
Financial conditions and the cost of doing business: A webinar from RSM US and the U.S. Chamber of Commerce
Rising interest rates have taken a toll on the middle market businesses that make up America's real economy. Yet demand for labor remains strong, consumers continue to spend and inflation is easing. How to make sense of the cross-currents in America's real economy? Join RSM Chief Economist Joe ... READ MORE >
Tech layoffs calm, but tech jobs still take a hit
Artificial intelligence advancements continue to be a primary source of optimism for the technology ecosystem and a partial counterbalance to challenges in media and entertainment. Employment data released Friday reflects not only that optimism, but also that wages in the industry are stabilizing ... READ MORE >
Canada’s economy contracts as higher interest rates take a toll
The picture of an economic slowdown is coming into focus as the Canadian economy contracted in the second quarter because of declining housing investments and household spending. Gross domestic product fell by 0.2% in the second quarter, according to data released by Statistics Canada on Friday. On ... READ MORE >