Events are outpacing the best-laid plans of policymakers. The current turmoil in the financial sector will place constraints on the Federal Reserve’s efforts to restore price stability. Our research indicates that the Fed, facing persistent inflation, will for now have to accept a ... READ MORE >
Inflation
Jobless claims and housing starts come in hotter than expected
Jobless claims and housing starts blew past forecasts in the most recent reports released Thursday, both showing stronger-than-expected results amid a looming economic downturn. New jobless claims fell by 20,000 last week to 192,000 following an unexpected spike in the previous week, ... READ MORE >
It’s a matter of trust: Financial conditions tighten on stability risks
Trust is the lubricant that makes modern commerce possible. It facilitates an uninterrupted operation of finance that allows firms to fund expansion and modern economies to operate efficiently. It reduces transaction costs, minimizes frictions and creates the conditions for broader and deeper ... READ MORE >
Retail sales and producer inflation fell in February
Retail sales dropped in February after surging in January, while producer inflation fell unexpectedly on the month, signaling easing demand pressures. Still, looking underneath the top-line numbers and through seasonal fluctuations, spending at retail stores remained solid. Wednesday’s ... READ MORE >
February CPI: Balancing price stability vs. financial stability as inflation remains elevated
Inflation in the United States accelerated modestly in February, increasing by 0.4% on the month and by 6% on a year-ago basis. It was a similar reading in the core number that excludes food and energy, with prices in that sector rising by 0.5% on the month and by 5.5% compared to a year ago, ... READ MORE >
Canada’s job gains came in hotter than expected as wage growth spiked
February's jobs data in Canada showed a still-strong labor market that did not offer any relief in terms of keeping inflation under control. The net change in total employment dropped to 21,800 from a whopping 150,000 increase in January yet remained above the expectations of only ... READ MORE >
U.S. job creation remains robust, implying more aggressive rate hikes
If one wanted to create a confluence of cross-currents that make the job of policymakers more difficult, one might choose the combination of a red-hot economy, robust job gains, elevated inflation and an estimated $620 billion in potentially unrealized losses inside the banking ... READ MORE >
Initial jobless claims spike to highest level since December
New claims for jobless benefits last week came in hotter than expected at 211,000, significantly higher than the 190,000 of the previous week, the Department of Labor reported on Thursday. The increase was in line with expectations following a large number of high-profile layoff announcements ... READ MORE >
Job openings remained plentiful in January, adding to pressure on the Fed
Job openings fell in January yet still came in hotter than expected, offering the Federal Reserve no relief in its fight against inflation. The central bank faces a crucial decision when it meets in two weeks: Whether to maintain its current peak policy rate of 5.5%, as it had announced a few ... READ MORE >
RSM US Financial Conditions Index tightens as market sees a hard landing
The RSM US Financial Conditions Index inched down to 0.6 standard deviations below neutral from 0.4 previously as policymakers, investors and firm managers prepare for a period of higher interest rates and persistent inflation. Markets are moving to price in a hard landing around a ... READ MORE >